I can't believe that no one has started a forum for this, so maybe I'm an idiot and just couldn't find it in the search... but I'm looking for the worst non-closing stories. Here's mine:
Been working this deal for about 18 months, 4-5 really hard. Money is in escrow, all that's missing is purchaser's signature and CEO goes dark for 36 hours. Come to find out, he never came home the night before, when he finally arrived home night before to shower, his wife discovered he had been fraternizing with the merger target's CEO's wife.
Yeah - basically we all just lost on a few mil in fees because this guy:
1) Couldn't wait till escrow cleared to 'consummate' the merger and
2) Didn't use a passcode on his iPhone and his wife found out he was screwing the wife of CEO he was trying to merge with). Blew up the marriage, family, and our bonuses.
Anyone top that? Have comparably miserable deals fall apart? There will be a breakup fee paid to the target, but bankers got shanked. Interested to hear others out there.
Wow. That is an incredible story.
Worst one for me was had a CEO who got cold feet after we ran 2 separate processes for him. Dude was an absolute psychopath and we ended up getting him a deal that was far above anything he said he initially wanted. Saddest / funniest thing is whenever he contradicted himself or pretended not to know something during negotiations, he would pretend he didn't understand because of the "language barrier." Yeah, dude was foreign but went to one of the Ivies, like come on bro.
Had the audacity a couple years later to ask if we wanted to run a 3rd process for him. That was a hard no.
We almost closed on a deal earlier this year after about 10 months of work.
Lender was lined up and had signed off.
QofE and other DD all done, etc...
Then the moron owner went out and nuked her business doing the dumbest thing possible. Literally sliced run rate ebitda by like 70% overnight. (welcome to e-commerce)
This gets better though, she tried sueing us claiming we led her on to collect data etc... Which was obviously horseshit.
I'm an independent sponsor too that decided to eat the 6 figure dead deal fees ourselves rather than try to push the deal through/collect fees/etc as I think a reputation for doing the right thing is worth far more money in the long run. I received emails and even a letter from the equity we had lined up thanking us for doing the right thing and they expressed interest in putting cash into whatever deal we did next.
So yeah...
Fun fun fun.
At least I got to eat a ton of Texas bbq.
I have no regrets though as her actions were not predictable and I got to learn a lot about how PE works at a granular level etc... (Operator turned investor)
What kind of an amateur walks from a deal because of an affair. The big leaguers use wife swaps to win deals, not lose them.
https://nypost.com/2014/10/29/investor-husband-pushed-me-into-sex-for-b…
Wait, so the purchaser pulled out of the deal because he got caught schtooping the target CEO’s wife? Would have loved to see the CEO of P try to explain to his board why cutting a massive check to walk away from an awkward situation makes more sense than canning his incorrigible ass.
+SB strictly for use of the word schtooping.
Man, I have had so many of these... Had a deal all ready to go, buyers cash ready and signature on the docs, freshly sent over on Friday evening. To celebrate, the seller (sole shareholder) decided to take their small-toy-shit-box experimental airplane for a spin. The seller flew through a storm, loss control and crashed...
Another one fell through because the target company's managers started posting expletive and offensive commentary of the buyer on twitter before the APA was even negotiated.
I also had a deal fall through because in diligence we found "company condos" were actually condos for the CEOs girlfriends and each girlfriend had a "company car" and were on the payroll. The CEOs wife found this out and, as a 50% owner in the company, decided not to sell and sue her husband instead...
My list can go on.