In today’s economic environment, businesses face a variety of critical issues. For some the issues are industry-wide where production moving off-shore has created competitive issues with devastating financial impact. Others deal with highly leveraged conditions resulting from acquisitions. Or possibly, over time the need for a specific product has simply changed. Whatever the reason, there is a point in time when, regardless of whether you are an owner or lender, continued investment just is not feasible. Should this happen and your ability to sell the business as a going concern is limited, an available option is to dispose of, or to liquidate the company’s assets. The term “liquidate” in this case simply means converting assets to the maximum level of cash. The assets may be tangible, (machinery, real property, equipment, vehicles, etc.) or intangible (trade names, intellectual property, customer lists, patents, etc.) but still represent real value to others who would view them as beneficial to their business. Proceeds from the sale of these assets are typically used initially to pay off secured creditors and suppliers, with the opportunity to provide capital to stakeholders or to fund new ventures when sufficient cash proceeds are available.
MainStream manages the sale of assets for middle market companies in a manner that yields the maximum recovery value. Often people misinterpret “liquidation” as selling items at a rock bottom price, a term that many would call “a fire sale.” At MainStream we utilize an orderly or managed liquidation process. Even when a business is distressed, following an orderly liquidation process normally yields the greatest return. An orderly liquidation is planned, controlled and moves at a pace that is deliberate and carefully orchestrated by MainStream Management. Move too fast and the organization’s loses value; move too slowly, and a similar opportunity is lost to create value. A well designed, orderly liquidation takes advantage of the very direct correlation between time and value. Our process begins with a liquidation recovery value analysis which provides an estimate of the money that will be received from the sale of the company or their assets.