How to Build a Billion-Dollar Business

CHAPTER 26THE SALE PROCESS BEGINS

To stay ahead of the financial requirements of the business we needed to raise $70 million from an outside source. Our preferred method to do this was with debt. This would give us the space we needed to complete the turnaround and sell the business at the right time. We were now the consistent number one natural health brand in Australia, and I always had the view that if we were to sell the business, the price should at least resemble Blackmore's value. (They were listed on the Australian Stock Exchange for $500 million and we'd been offered this sum before by the private equity firm, so that was what I thought we should be valued at.) Surely the American failure hadn't cost us that much in equity value? (At the time, it felt like I was the only one in the world who thought we were still worth at least that.) Now that Stephen and Michael could see a finish line in selling the business, both were keen to start a sales process. I was not so sure, but I was ready to go along with their vision. It wouldn’t be easy. To achieve this sort of valuation, we’d need time for the turnaround to permeate through the rest of the business. We'd been carrying so much stock for the United States, it would take at least 12 months for the full effect of our cost of goods efficiencies to flow through, and the same could be said about our other cost management initiatives. The turnaround would work. It would just take time.

Nonetheless, we still needed to increase ...