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Show Pge12 How to Buy Your Working Capital (continued from page 3) wherewithall to obtain finan- The goal is to negotiate a small and an down-payme- cing. Leverage the Assets The basic principle to be employed is to acquire the division or subsidiary with its own assets. At first glance this seems unlikely, but indeed not only can it be accomplished, but many times substantial working capital will remain after leveraging the assets and making a downpayment for the acquisition. nt extended payout, or better which is then yet, an earn-ou- t the source of financing. If adequate salesmanship pervades throughout negotiations to avoid a sellers lien on the assets being acquired, the assets will now serve as collateral for raising debt capital. With a small down payment and extended pay- - or earn-outhere will be surplus capital to finance operations, expansion, etc. In a situation t, where the acquisition involves equipment carried on lease to customers by the seller, move fast and be absolutely sure to include the leases in the deal. It is easy when the closing has been consummated to assign leases to a leasing company for cash, make the downpayment, and pocket the difference for working capital. The mechanics of affecting an acquisition which gener- ates capital instead of publicly and therefore holds a times a deal like this will fall definite value, the mechanism into place by keeping an ear to can be to make the acquisition the ground, an imagination with stock or convertible debworking overtime, and a fine entures, leverage the assets edge honed on sales objectives acquired, and bank the surplus. However, for private companies, companies not wanting to issue additional securities, or when the seller will not accept equity for the acquisition, the concept of using the acquired assets to make the acquisition must be spending it are numerous.' If a utilized. It's surprising how many companys stock is traded Official Steps Down at PATI SALT LAKE CITY-Paci- fic Air Transport International, Inc. (OTC .02, .03) Salt Lake based manufacturer of modular panel systems and shelter products, recently announced the resignation of Harold D. Stoker as president of the company. Succeeding him is Gholamhosein Sharifi, a citizen of Tehran, Iran, and president of Yamack Company and an Iranian export-impoconstruction firm. Stoker in the capacity of Chairman of the Board. rt cont-tinu- es Sharifi, 38, holds a doctor ate degree in economics from the University of Tehran. He is intimately involved in the Iranian business community, Stoker said in announcing his resignation, and is in an -- xxrtwfcre excellent position to represent PATIs interests in that country. Sharifi plans to file for listing of Pacific Air Transport shares for trading on the Iranian Stock Exchange, Stoker said. After returning from Iran last spring, Stoker said he is convinced Iran clearly repre- sents the best potential market for the companys products and manufacturing He emphasized expertise. the emerging need for modu- lar leisure homes being created by construction of new access routes to the Caspian Sea area, Irans prime resort area. In addition, Iranian government purchases of several hundred thousand head of cattle and sheep for breeding will soon necessitate animal shelters, he said. For further information please call James Barrett. Chairman. Area Cade 208 356-4229. First Lombard Corporation While in Iran, Stoker negotiated a contract for PATI to supply panels for 25 leisure homes to be erected near the Caspian Sea by an Iranian construction firm. The order, which yet requires letters of credit, represents a possible total sale of $250,000, according to Stoker. Stoker said the company is also contemplating opening an assembly line and factory in the southern California area in order to take advantage of production and better accessibility to transportation and shipping. This decision, he continued, will be based on the availability of financing at the time. year-roun- d Investment Bankers Salt.Lake City Idaho Falls |