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UAE based hardware retailing and corporate sales 'Business' is actively pursuing a business divestment. The Business has been in operations for over 28 years. Salient features of the opportunity are:
1. The 'Business' has been in operations for over 28 years now in the UAE and is well reputed in the industry
2. It has a very strong 'Retail' presence with a highly visible showroom in Sharjah
3. The 'Business' has a strong foothold in the UAE 'Construction' and 'Manufacturing' customer segment and in recent years has strategically focused its business development efforts on its 'Manufacturing' customer base in order to increase the quality of its cash flows
4. The 'Business' has a robust more than 18 years old local, regional and now US based relationship with a global formworks and scaffolding player. The 'Business' currently exports to the 'Key' customers GCC, Americas and Far East entities directly and has strong prospects for further growing exports to the US entities
5. The owners are pursuing a discounted future cash flow value for their 'Business' and want to see the 'Business' grow further under a new management (historical financials and forecasts for the next five years can be obtained on request)
6. The 'Business' owners are proactively taking actions necessary to achieve the forecast sales
7. The owners do not want to receive the value for their 'Business' in one go, but instead in two instalments: one at the time the agreement is entered, and the other after a year of working with the new owners, or their management team, to transfer all customer and supplier relationships to them and to support the new owners achieve mutually agreed sales target for the first year of the acquisition
90,000 for showroom and warehouse per annum
Prime industrial area location with ample parking for customers
Highly visible (more than 4 shutter) retail showroom along with a double floor warehouse in central industrial area of Sharjah
The business has in recent years rationalised its customer portfolio with a strategic focus on acquiring and retaining customers in the 'Manufacturing' segment in the UAE, while still maintaining a string presence in the more volatile Construction sector. Several of its manufacturing customers export their products. Hence this strategy has helped the Business improve the quality of its cash flows. These customer relationships can be grown further with string cross sell and up sell initiatives, formal sales team structuring and incentives. The Business's retail showroom can also be leveraged further for higher retail sales through proper over the counter sales incentives and training of employees for higher cross sales. In addition, the business has a very strong relationship with a global formworks, scaffolding and shoring company. The business has annual sales of over AED 3 Million to this customer alone and has recently started exporting to US and Far East based entities of this customer. Prospects for increasing sales to the international entities are very high.
High competition but the business has very strong and old customer relationships that are growing in value
The owners want to pursue philanthropic works and do not have any successors continuing in the Business.
9 am to 8 pm with a 3 hour break from 1-4 from Saturday through Thursday
The owners want to work with the buyer for a period of up-to one year to transfer all customer and supplier relationships to the new management team
The sales price can be paid in two instalments, the first upfront at the time of entering into the sale contract, and the second after a year after all customer and supplier relationships have been passed onto the buyer. In addition, since the business does not have any debt whatsoever, the buyer will be able to obtain bank financing fairly easily.
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