| Deciding to sell your portfolio is never an easy decision to reach,
especially considering the very reason the sale would generate a profit
is the strong current and future earnings from the portfolio. When
you divest, you give up that future earnings stream. Still, when an
organization needs an immediate boost to earnings or capital, or both,
the card portfolio becomes an even stronger contributor to shareholder
value through a portfolio sale, partial or total.
Over 70 issuers decided to sell last year, not counting numerous,
smaller transactions. These ranged in value from less than $20 million
to over $80 billion.
If we are retained as the investment banker to intermediate a portfolio
sale, the following services are customarily provided:
- A net/present value estimate and transaction expectations are
prepared.
- A book of prospective bidders is built.
- Bid instructions are prepared.
- The Offering Memorandum is constructed and distributed to those
known portfolio bidders most likely to be interested in the portfolio.
- Discussions are held with potential bidders clarifying the
portfolio characteristics.
- Due diligence is coordinated, and letters of intent and contracts
negotiated.
- The transaction is closed.
- The foregoing can usually be accomplished in 45-60 days, although
shorter time frames can be accommodated.
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