Industries Served

Manufacturing & Industrial

  • Sheet and Fabricated Metal Manufacturing
  • Metal Fabrication
  • Electronics Manufacturing
  • Healthcare and Medical Device Manufacturing
  • Heavy Machinery and Industrial Equipment
  • Medical Equipment Manufacturer
  • Automobile Manufacturing
  • Industrial Equipment and Heavy Machinery Manufacturing
  • Chemicals Manufacturing
  • Fabrics and Textile Manufacturing
  • Millwrighting Companies
  • Machine Shops and CNC Manufacturing
  • Custom Woodworking and Millwork
  • Print & Sign Manufacturing
  • Specialized Plastics
  • Precision Manufacturing
  • Skid and Pallet Manufacturing
  • Automotive Manufacturing
  • Niche Manufacturing
  • Consumer Discretionary Products
  • Manufacturing, NEC

Beacon has advised several businesses in the manufacturing and industrials sector.

Mandate

Beacon was engaged by a manufacturer of custom fabricated metal products with a 30 year history. The business designed and manufactured custom walled tanks and silos for industrial and agricultural use. The owners of the business, at the time, were seeking an exit due to retirement. Due to Beacon’s strong outreach across North America and experience in the manufacturing and industrial sector, Beacon was chosen as the exclusive broker and provided sell-side transaction advisory services through the entire sale process.

Implementation

Beacon began by compiling a fairness opinion to determine the business’ true fair market value and proceeded to compile deliverables and confidentially market the mandate to potential buyers. The business had a fully owned stat-of-the-art facility with CNC manufacturing capabilities and ample capacity to expand production. The business was effectively positioned for growth through diversification of its product line as well as deeper market penetration through aggressive sales and marketing. Through our large network of buyers and industry professionals, we were able to attract several buyers for the business. Based on the seller’s criteria and vision, as well as our financial acumen, we were able to pre-screen buyers and solicit offers from serious buyers.

Outcome

Beacon’s team assisted our client through every step of the sale process, and successfully completed the transaction. Beacon effectively negotiated a share deal with a private buyer, based on a 3-year weighted average EBITDA multiple. An additional amount was paid to acquire the business’ manufacturing facility and property. The deal was structured with a 75% payment at close and 25% VTB payable in monthly installments over a one year term. Our team was actively involved through the due diligence process, ensuring transparency between both parties. In addition, Beacon assisted with succession planning to help maintain smooth operations through the transition period without damaging the value of the business.

Industry Overview

The manufacturing and industrial sector is broad and is comprised of all manufacturers which supply finished goods, or intermediate goods and components to wholesalers, retailers or other manufacturing businesses. The industry depends on suppliers of basic raw materials. This includes mining companies, oil & gas companies, chemical producers, energy and natural resource industries, farming and agribusinesses. Most businesses in this industry are in their mature phase, however, depending on the sub-industry, they may be in their growth phase. For example, medical device manufacturers may be in their growth phase; however, engine manufacturers are in their mature phase. Overall the industry faces moderate to heavy regulation. The manufacturing industry is influenced by multiple factors including commodity prices, wage hikes, and the global trade environment. The manufacturing index (PMI) is a good economic indicator which tracks and measures the performance of manufacturers based on new orders, inventory levels, production, supplier deliveries and employment.
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