An Acquisition Case Study

The Challenge

Acquisition of two manufacturing divisions of a Fortune 1000 manufacturer by two independent sponsors.

The first company is a manufacturer of three segments of the refuse collection body market: front loaders, rear loaders and automated side loaders. The company also has a refuse parts division, which sells replacement parts to the refuse body market.

The second company is a manufacturer of concrete mixer bodies (standard rear discharge, bridge saver rear discharge and front discharge) and a supplier of parts and auxiliary products.

The Solution

The independent sponsors contacted Accord to supply the necessary debt capital to complete the asset acquisitions. The operations were consolidated at one facility, resulting in significant cost savings and manufacturing efficiencies. Divesting from the parent company enabled broader distribution to end users who prefer different chassis than those the parent company produces.

The Outcome

The new debt facility leveraged the accounts receivable, inventory and equipment to provide 100% of the purchase price, and also, provide working capital that will allow the company to maintain sufficient inventory to complete orders that were previously turned away.