Chapter Four: Divesting of Al Safa
When Joyce’s mom passed away in March 2006, Joyce told me that she wanted to spend her father’s last days with him, however long that would be. Her father was eighty-four years old at the time and lived at the Polo Club in Boca Raton. We decided that we would move to Boca Raton for Joyce to be near her father. I knew that I could not run Al Safa from there, so we decided to sell the business. We hired Stevenson & Company in Chicago to run the process, and they ended up brokering a deal for us to sell the business to someone in Providence named Duran Nanjiani. He in turn arranged with a Sovereign Wealth Fund in Malaysia to fund the purchase of the business and the capital required to grow the business. The date of the closing was in August of 2007.
Just before the closing, the buyer announced that he required a few more weeks to complete his deal in Malaysia.
School in Florida starts in mid-August; thus, in order to get there in time for school to start, we moved to Boca Raton in August 2007, even though the deal had not closed yet, though the closing date was imminent.
On September 4, 2007, I flew up to Buffalo on Southwest Airlines for the closing, which was to take place at the office of Bob Olivieri of Hodgson Russ, our law firm in Buffalo. When I got off the plane, I had a voicemail and an email from Nanjiani. They both said the same thing, namely that the Malaysians had backed out at the last minute, and that the deal was off, with no chance of it being reinstated.
In retrospect, we came to realize that Nanjiani had no intention of ever closing the deal. He strung us along simply to get as much information from us as possible, so that he could start a competing brand, and in fact, that is exactly what he did.
Frankly, I was crushed and physically sick by the collapse of the deal. I now had moved to Florida and had a business in Canada. Our entire year of dealing with Nanjiani had totally taken our eyes off the ball, and I knew right away that it would take a very long time to put the pieces back together again.
For four years I commuted from Florida to Cambridge, Ontario, to run the business. I tried very hard to arrange affairs so that the business could run without me being there so much, but I was entirely unable to do that.
In January of 2009, Kraft Foods approached us to buy the company.
As we were starting talks with Kraft, we were also approached by Engro Foods, a subsidiary of Engro Corp. of Pakistan. Engro Foods was interested in entering the North American market with their own products, and they felt that they could use Al Safa as an entry into North American supermarkets.
In the end, it was worth more to Engro, and after four years, on May 6, 2011, we completed the sale of the company to Engro Foods. That sale process also took a year, and it was a grueling and unpleasant process. What I found was that the buyers had a deep-seated belief that in any transaction there is a winner and a loser. The idea of win-win is simply not in their belief system. Having decided they were interested in buying the company, they basically spent a year trying to answer the following question: “If a Jew wants to sell us the company for X, then it must not
be worth X, for if it were, the Jew would not be selling it for X. What is he not telling us that makes the company worth less than X?”
The fact is that we were not hiding anything from them. However, they hired Price Waterhouse, which came in and examined literally every invoice we had ever issued and every payment we had ever made, all the way back to 1999. After all that, which took a matter of many months, Price Waterhouse determined that everything was in order.
