{"id":4443,"date":"2025-10-12T23:25:27","date_gmt":"2025-10-12T21:25:27","guid":{"rendered":"https:\/\/maraz.es\/?p=4443"},"modified":"2026-10-12T10:49:51","modified_gmt":"2026-10-12T08:49:51","slug":"distressed-ma-how-to-sell-a-company-in-crisis","status":"publish","type":"post","link":"https:\/\/maraz.es\/en\/distressed-ma-how-to-sell-a-company-in-crisis\/","title":{"rendered":"Distressed M&A: How to Sell a Company in Crisis and Maximise Value"},"content":{"rendered":"

Distressed M&A: Why selling a company in crisis can be an opportunity<\/h2>\n

Although the word \u201ccrisis\u201d is usually associated with value destruction, in the M&A world there are investors who specialise in complex situations. A well-structured sale can avoid liquidation, preserve jobs and generate returns for shareholders. The key is to identify the hidden value and present it correctly.<\/strong><\/p>\n

Key strategies to maximise value in a distressed sale<\/h2>\n

To maximise value in a crisis sale there are three objectives: buy time, reduce uncertainty and create real competition between buyers.<\/p>\n

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  1. Immediate financial and operational diagnosis<\/strong>: before starting the process, it is essential to understand which areas can be stabilised and which assets have strategic value. This helps define whether the sale will be total, partial, or by productive units.<\/li>\n
  2. Restructuring before the sale:<\/strong> renegotiating debt, optimising working capital and adjusting the cost base can improve the buyer\u2019s perception. You can expand on this approach in our article on “what banks expect to refinance debt<\/a>“.<\/li>\n
  3. Transparency and clear documentation<\/strong>: in distressed contexts, buyers value speed and clarity. A complete information pack (financials, contracts, litigation, assets) reduces perceived risk and accelerates the process. Professionalise the information: a clean data room and seller due diligence that show, using simple metrics, why the business is viable (order book, customer concentration, margins by line, normalised working-capital needs and a 100-day operating plan).<\/li>\n
  4. Stabilise cash<\/strong> with a 13-week cashflow plan and, if necessary, bridge financing: avoid \u201cfire sales\u201d.<\/li>\n
  5. Define precisely what is being sold<\/strong> (the profitable unit or a carve-out) and ensure continuity: identify critical contracts (customers, suppliers, leases, IT), licences and key personnel, and prepare in advance the authorisations or novations required.<\/li>\n
  6. Design a short, competitive process with clear rules and a timetable:<\/strong> equal access to information for all, a minimum required offer and, where appropriate, a \u201cstalking horse\u201d bid that sets a floor.<\/li>\n
  7. Structure price and risk properly:<\/strong> earn-out (part of the price linked to recovery milestones), escrows and limited warranties, selective assumption of liabilities and, where it adds value, transitional services by the seller (TSA) for an orderly handover.<\/li>\n
  8. Manage stakeholders<\/strong> (banking pool, Tax Authorities\/Social Security, employees and unions) and the market message: a clear continuity narrative preserves the going concern and supports multiples. A specialised adviser can coordinate these fronts effectively and avoid unnecessary discounts.<\/li>\n<\/ol>\n

    Factors that influence the value of a company in crisis<\/h2>\n