Transactions

Badger Die Casting

Giving sellers an edge by generating and cultivating options ...

Situation
Badger Die manufactures aluminum die cast parts used in the electrical components and industrial machinery industries. The Company's niche is commercial components that require close tolerances, relatively short runs and include value-added machining.

Four family members owned Badger Die and spent their careers at the Company. They were no longer interested in managing Badger Die’s growth. With consolidation taking place in the industry, the owners felt the best course of action for their customers and employees was to sell to a motivated party that could take Badger Die to the next level.

Scope of Mertz’s role
Mertz advised Badger Die in designing a selling program, preparing offering materials, contacting potential purchasers from a customized database, evaluating proposals and participating in negotiations with numerous buyer prospects, including Northstar Holdings, the eventual buyer.

Because Badger Die was a job shop, finding buyers with a strong interest was challenging. Mertz designed a marketing program that sought the most logical strategic and financial buyers and opened up preliminary discussions.

As a result of the marketing efforts, Mertz brought over ten interested buyers to the table. This established the market for Badger Die and provided the sellers with options. The mix of interested parties was evenly divided between industry buyers and financial buyers.

Based on the initial expressions of interest, Mertz and the sellers narrowed the field down to four or five industry buyers. Eventually, the owners of Badger Die proceeded with Northstar Holdings, a private equity group with existing aluminum die casting operations.

Mertz’s value add
By contacting the best buyers available, Mertz generated competing interest in Badger Die and presented the sellers with options. Also, the buyer was from a hard-to-identify group of private equity groups with existing complementary operations.