Our client company produces a diversity of precision machined parts for OEMs. It enjoys a reputation of high quality and reliability, catering to a wide range of companies throughout New England and the nation. It enjoys repeat business and is tenacious in serving customer needs.
The owner invited us to talk about next steps. The company had grown remarkably through the years. However, its can-do reputation and determination for rapid turnaround also kept the owner locked to a desk and computer. After taking the first real vacation in years, the owner returned with a different vision: a rapid path to “life after business.”
Initially, liquidation was a serious consideration. It would offer a quick exit but would hurt loyal employees and disrupt the customers who had come to rely on its quality production. We suggested a valuation study, which revealed liquidation would be the worst option. In fact, the company was highly profitable, had good systems in place and was poised to be effectively transferred. We proposed a sale.
Although the company fit into the “job shop” category, it performed substantially above average and was tenacious in pursuing efficiencies that could be repeated in future orders. This would make it highly desirable. We would look for a buyer with industry experience who would also retain the plant, owned by a separate but related entity, and the highly skilled workers who were like family to owners.
We went to market, approaching a series of industry players with a focus on those seeking a second location or market sector diversification. Several companies were interested and met with our client, including an investment group assembling a manufacturing group within the Boston area. Several letters of intent were received, and one was selected. We facilitated a thorough diligence process with records provided via our data room. This enabled the owner to stay focused on business.
Owners received price and terms that met their goals. From start to closing, the engagement lasted 10 months. The President would remain as a consultant for several months, transitioning customers and assisting new management. The staff was retained and new jobs created to enhance engineering, quoting and job origination. The buyer group leased the facility for years into the future, another financial benefit to the owner.
Business Transition Strategies is a New England-based mergers and acquisitions firm advising owners of privately held companies how to navigate the sales process. Our team of professionals also provide advisory services to help prepare for a sale down the road. We also provide buy-side assistance. If you are considering a transition, now or in the future, contact us to begin the discussion.
"The entire process went smoothly and professionally. The BTS team kept me fully informed at every step. They worked hard and were effective in bringing the deal home."
"Skip and I continue to be grateful for all you have done to make the sale of Pure Flow come to fruition."
"BTS’s level of expertise in the process and close attention to detail enabled us to successfully navigate the deal."
"These types of transactions are often long and complicated and I doubt it could have been successfully completed without your close ongoing involvement."
"The outside objective point of view that you have brought us has been invaluable as we prepare for the rapid growth."
"John then found the right buyer and coordinated a seamless transition—he doesn’t miss a single detail."
"John immediately identified our strengths and experiences and discussed a business that ultimately was more in line with our goals."
"The BTS team came in, evaluated everything in a professional and thankfully non-threatening manner."
Private Equity Trends
More and more PE firms are searching for smaller transactions. The reason for this is simply competition
Using a Specialist in M&A
While using an industry specialist to market a company may save a few days in preparing the offering materials, there is the danger of a cookie-cutter approach.
Legal Breakfast Series: How I Sold My Company - A Case Study
Attorney Peter Burger and John Howe of Business Transition Strategies will be the featured speakers during the latest Orr & Reno Legal Breakfast Series on Wednesday, June 14 at the Orr & Reno offices
What's Next Really Matters
The book explores the exits of owners ranging from the good to the bad, from the joyful to the ugly...Often overlooked is the reality that after the closing, everything will be different.
Staying Current to Help Clients
Twice a year we attend a deal expo with private equity groups and strategic buyers...Connections made at this event broaden our list of people who will take our calls, answer our questions, help when
Overcoming Fear of Public Speaking
Communication skills are critical in business, and overcoming fear of speaking is fundamental...it can be the difference between getting a sale or missing out.
P+E+S=EF, a winning formula for Michael Coles
The experience factor is the way a customer feels about a business, and in part determines whether the customer returns or goes elsewhere.
Tailwinds Continue for M&A Deals in 2017
There are good indications that the favorable tailwind continues for M&A activity in the coming year. Key indicators paint a clear picture: buyers are actively seeking opportunities that advance thei
Why Consider a Buy Side Transaction?
There is also a truism when it comes to growth, “It is much faster to grow through acquisition than organically one customer at a time”.
Is 2017 the time to act?
Wrapping up 2016, and considering key initiatives of the year, we see trends that we believe will continue for New England M&A in the year ahead. Key things we are seeing:
Precision Machining Company
Initially, liquidation was a serious consideration. It would offer a quick exit but would hurt loyal employees and disrupt the customers who had come to rely on its quality production.
Green Product Company
Our client owners could dig in for the long haul…However, this would take five years or more. Owners simply lacked the horsepower to do it.
Water Purification Company and Young Buyers
Owners decided they wanted to retire. They also wanted to be fair to the staff who had been loyal to them. Could the company be sold, the staff retained and the facility remain in use?
Magnetics Company with High Profile Customers
(T)he manufacturer would need to focus on growing EBITDA to capture interest from major strategic buyers and achieve a higher multiple of earnings.