Corporate u-turn

THE SITUATION: EVERYONE CHANGES HIS OR HER MIND NOW AND THEN. RELATIONSHIPS FORM, BREAK UP AND SOMETIMES FORM AGAIN. NEW PRODUCTS ARE DESIGNED, BUT NEVER MANUFACTURED. BUT, AS ROSE CHEN NOW REALIZED, CHANGING YOUR MIND ABOUT SELLING YOUR BUSINESS IS NOT A

The founder of Toronto’s DiversiFind Services, a promotional goods supplier for corporate firms looking for personalized hats, T-shirts, pens and other giveaway items, in August had told her board that an acquisition offer from Gaspin Partners undervalued the firm. “Until recently, I’ve been adamant that we could get to $40 million in sales a year, about twice what we’re doing right now,” Chen said. “My board voted overwhelmingly in favour of rejecting the offer.” But Chen has since had a change of heart and she fears that she has mismanaged her board.

Four of DiversiFind’s five board members — one was Chen and another was chairman — owned 25% of the company. The three investors had backed Chen when DiversiFind was founded in 1994, just as the economy was recovering from the recession of the early 1990s. Chen had grown her firm from a home-based business to one that had a roster of 350 clients.