Quote:
Originally Posted by golfing eagles
Unless the plan was to eventually sell right from the beginning in 2012. Negotiations for a sale began BEFORE the discovery of the mistake in billing
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which would make sense in that the acquiring company's due diligence is always to validate and forecast the future revenue stream. And if the acquiring company found issues with the current revenue stream, like improper coding, upcoding etc, which was raised somewhere, then the wheels fell off the cart.
Late 90's, I did an acquisition analysis of a company we were bidding on, and the current owner, Dow Jones Co, had purchased this company for $1.5 B two years prior to putting it up for sale at $500M (1/3 of the acquisition cost, or $1.0B of incinerated cash), and I came up with $300 million due to the rapidly declining revenue stream. . . The winning buyer bought the company for $500M and went bankrupt within the year. Sometimes the insiders know when the gig is up. . especially with any reasonable future revenue analysis. .
I have worked for two companies which eventually went bankrupt, and there are tell tales signs if you know where to look. . . and two which were taken over being successful. . the differences are obvious on the inside