Often the process of evaluating a firm is as educational for the firm's management as it is for the buyer. Such is the case with Project Spy. We descended upon Spy with a soft touch, the seller being terrified our presence might alert employees and middle management that the group is "on the block."
Spy has been the victim of borderline criminal management negligence for some time. The head of the division head has, in my opinion anyhow, been snowing the home office with such regularity that it had become the normal course of business. The fact that the division we looked at is operating at a loss was news to even the senior management, which had been lulled into an alarmingly placated state with respect to the performance of the division in the United Kingdom. In this day and age of Sarbanes Oxley this is beyond astounding. The conference call wherein we revealed this bit of news was notable chiefly for the longest sustained silence I have ever encountered on a telephone that wasn't unplugged.
Think Sarbanes has flushed out all the dirty secrets? Think again.
Our big challenge now is to administer sufficient medical attention to the shock stricken senior management to get them to actually sell the division.
(Rembrandt, "Self-portrait" 1630, Nationalmuseum, Stockholm)