In January, 2004, a 20 year old manufacturer of RIM (reaction injection molding machinery) merged with a six year old manufacturer of food processing automation equipment to form this entity. The newly combined company enjoys two distinct markets while operating with a shared engineering and administrative staff. The business doubled its space during the summer of 2008 moving into a drop dead gorgeous 48,000 square foot facility owned by the majority shareholder and leased to the business. The real estate may be purchased separately.
The majority owner is in his late 70's and is looking forward to retiring. The rest of the management team works well together and combined they boast over 100 years of experience. The business comes with a skilled, loyal, and long serving work force. Additionally, a strong CFO was brought into the business in early 2007. He put the job costing system on solid ground, and meaningful monthly financial statements are compiled on a very timely basis. The group feels that with a new owner/CEO the company has $15.0 million annual sales potential without either significant capital investments or the need for more space. The food processing component is especially attractive with the company currently making inroads with major domestic and international customers.
In the five years since the merger, the business has recorded revenues from $5.0 million to the high water mark of $7.0 million in 2008 with sellers discretionary earnings (SDE) from continuing operations of nearly $750,000 in 2008.
The companys only debt is a $1.5 million bank loan which is guaranteed by the majority owner. The shareholders would tender 100% of the stock of the business if the buyer gets the sellers loan guarantee cancelled and commits to grow the business so that the employees can have a chance at the kind of success of which the business should be capable under a strong, new CEO. Additionally, the seller has expectations of royalties on future revenues.
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