The NewsX 27: list forwarded to possible new investors?

NewsX

I got a phonecall late Monday night about how independent auditors had forwarded a list of 27 people in key positions to people interested in buying out a stake in the company.

There seems to be a general sense of unease that these are the people who will be asked to leave.

My take on this is simple: in a buyout of any kind, the people doing the buying want to know what they’re getting. And that includes the people who will have to ensure that things keep running smoothly even as ownership changes.

Auditors typically just send a list of people in key position. Depending on the situation they sometimes also include assessments of whether these people will choose to stay on, and their general capability level.

That, according to the caller, obviously spells trouble for a number of people in NewsX.

I’m going to disagree. In my opinion, it is not in any new investors interest to create an atmosphere of panic by asking a lot of people to leave. They may well be satisfied just with the people who choose to leave on their own, and even there, you might see some people being wooed.

Any which way, this is part of the standard due diligence that any company goes through when its exploring a stake sale.

Oh, the caller also mentioned Rajeev Chandrashekhar’s  Jupiter Networks is still in the mix of potential investors. Regular readers will remember this post from a few days ago about news reports that Bhaskar was about to close the deal.

I am putting all of this down in the unverifiable rumours department.

Recovered from the site’s WordPress archive, where it was published on 2008-12-08.