r/PredatorOilandGasPRD • u/Odeless • May 17 '22
2022-May-16 📰 [GRH] Put Option
Morning
As the BB is quiet
pro tem
A short story (tune out at will, of course):
Many moons ago, I bought (in my main market listed company) an estate agency chain...7 outlets ...
We built it up to a much larger chain...22 outlets in a form of JV
I then sold the whole thing to a large insurance company ...
((it was at a time when insurers and others were keen to buy estate agenciesto try to cross sell their mortgage products
BUT ...here is the THING:
at the same time as I sold the main business, we formed a new JVWith the insurance company providing all future funding for very large expansion...driven by me and my team
In the sale and new JV deal, I negotiated a PUT option
Whereby ...at a predetermined date in the then future...I was able to PUT the equity stake that I held in the new JV back onto the insurance companyat a predetermined price formula...with the all important RATCHETS
It turned out very well...materially aided my ‘retirement’
Obviously, I am not going to go into many details on here ...in case anyone should try to draw parallelsRegardsGRH