Web company dropping SEO services! Why?

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A potential new client emailed us saying that his new website just launched and the web company currently doing his online marketing had been bought out by another business who are ONLY interested in doing web design and he would like to know more about our services.
I almost fell off my chair, what company would ignore Internet marketing? Surely they go hand-in-hand. I mean, who has a website build today that doesn’t want it to be found in the search engines? Or am I missing something?

It gets better…
We had a good look at the potential client’s website, it was build using a custom CMS system, on the surface it looked okay. The web company had a great video showing off how wonderful it all was, drag and drop capability, ease of use etc. Looking at the code we can all pick holes, but the big shock came when we checked with Google.
If you type site:www.yourwebsitename.com in a search box Google will show you the pages it has indexed of the site.
The results showed 325 pages, but this was only a 40-page website!
When we looked closer there were only 3 pages that were actual pages from the website, the other 322 where CMS template problems. We got the client on the phone and showed him, he went silent with shock. We offered some solutions, which he asked to be emailed to him and he would take to the current provider.
Next thing his site is down with an ‘Internal Server Error’. Not a good sign!