Selling your first-born child - Image Magazine


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Selling your first-born child

Selling your first-born child

This article first appeared in the February issue of Digital Image Magazine

Well, I’m not sure that any of us would consider selling our kids, although I must admit during their teenage years, I did consider it a few times. (Actually, more than a few times). I even tried trading them for a new pet dog. And yes, I am joking!

However, after completing the sale of Kingman Visual in December, it very much felt like we had sold our child, or at the very least, a massive part of our heart.

We first started the business in 1984 as a one-man signwriting business, after relocating from Melbourne, arriving in Perth and knowing no-one. In December last year we completed the sale with over 50 staff and an eight-figure turnover - it had been a massive journey. I was warned that completing the sale of a business could be as stressful as a divorce. I scoffed at those words of wisdom from my agent, but truer words were never spoken.

If you’re aren’t familiar with the difference, a share sale is where the purchaser buys the shares in the company and the company continues along as normal. It’s a bit like changing drivers of a vehicle in motion - the car keeps moving, same registrations plates, tyres, wheels and scrapes on the paintwork, only the drivers change. The investors purchase the company, warts and all, so due diligence is a vital part of the process and can be quite emotionally challenging to say the least. If you like strangers disseminating every detail of your business life for the lifetime of your ownership, then you’ll probably be fine with it. It was very invasive for me, yet I am fully aware that I would be asking the same questions if I was the buyer.

With an asset sale, just the company name and assets are sold. That is, you sell “ABC Signs” as a trading entity, for example, but you retain the financial assets of the balance sheet. The new owners pay you for the name, or goodwill, then purchase the stock, plant and equipment.

Yet a share sale can include your balance sheet, which is the retained earnings and cash at bank, plus franking credits and any tax credits that may exist. You can decide to take the cash at bank prior to settlement but this will be as earnings or Directors fees, and taxable. It all forms part of the negotiations. The advice of a very good lawyer is paramount to both parties but does create its own issues, as opposing lawyers obviously aim for the best result for their respective client.

We planned the share sale for 1 December 2020, however the purchasers’ financiers needed more information, so settlement wasn’t concluded until 16 December, which throws the end of month figures into chaos, literally days before Christmas. A ‘petri dish’ for stress.

On 16 December, we were retired, just like that. We had sold the child, warts and all. I ask you to imagine that feeling, you’ve signed copious amounts of paperwork in the lawyer’s boardroom, conversed with people you don’t really know who are about to own the very fabric of your soul you have given birth to, raised and nursed when they weren’t well. And then, it isn’t yours anymore.

When we went to the office to pick up Dianne’s car, we politely said our goodbye’s. We had already held our end of year staff function and used that as a formal thank you and farewell to our team. We chartered a 60-foot cruiser some weeks prior as we did many times before for our staff Christmas functions, but this was different, emotions were at boiling point. Many people had worked with us for over 10 years, some much longer. They were family. There were lots of hugs and many tears at the end of the night, the end of an era. The end of 50 years in the sign industry, the only job I’ve ever had.

Dianne and I leave our company with our name on the building. We leave over 40 awards on the walls of the boardroom and as I drive around Perth I smile when I see Optus Stadium knowing the 12,500 signs around the stadium were probably my “watershed” moment.

I and my team of exceptionally talented people have proudly built some of the best signage in this country. It was a massive team effort.

If it’s time to sell your “baby”, make sure you do your homework and prepare, it will be a journey full of emotion, pain and joy. Accept that it’s time for your next stage in life, whatever that stage may look like.

In the meantime, stay in touch. I have met so many wonderful people in this industry and I will continue to talk, meet, coach and have fun.

Vernon Kingman has been in the sign industry for over 50 years, owning one of the country’s most respected companies. He now writes, coaches and mentors businesses to reach their goals.Vernon can be contacted on


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