Most founders assume that they’re in the home stretch once they sign a letter of intent (LOI). The deal is as good as done.
Kevin Wagstaff thought the same—until his acquirer pulled a last-minute move that nearly cost him millions.
Kevin and his brother bootstrapped Spectora, a SaaS platform for home inspectors, with just $2,500 each. After years of relentless work, they landed an $80 million offer. The deal was clean and the terms fair—until the night before closing.
That’s when the acquirer re-traded the deal, demanding:
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A $25 million seller’s note (meaning Kevin and his brother would be financing part of their own buyout).
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A $10 million earn-out (putting millions at risk based on future performance).
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A 36-month call option (giving the acquirer the ability to scoop up more of the company at a pre-set price).
It was a classic squeeze play: Get the seller so invested in the deal that they’ll agree to almost anything just to get it done.
But Kevin didn’t flinch. He walked.
That decision changed everything. In this episode of Built to Sell Radio, you’ll learn:
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How to spot the signs of a re-trade before it’s too late.
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Why acquirers count on sellers being too deep to walk away.
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How Kevin’s decision ultimately led to a better deal at a $90 million valuation.
Quote of the Week
The night before close, we sent wire instructions. Then we got an email changing the deal—$25 million seller’s note, a $10 million earn-out, and a 36-month call option. It was a complete re-trade.
Deals
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McStarlite Co., a provider of sheet metal aerospace components, has been acquired by Standex International Corporation (NYSE: SXI) for $56.5 million in cash, financed through Standex’s existing revolver. Standex designs and manufactures products for various industries, including aerospace, food service, and electronics. In calendar year 2024, McStarlite generated $33 million in revenue with an adjusted EBITDA margin of 20%. The acquisition price reflects an EBITDA multiple of 8.56 times.
