Transactions
Oconomowoc Tool & Die
Marketing a difficult-to-sell company …
“When I was looking to buy a company I talked to many intermediaries. I concluded Mertz was the “cream of the crop” and knew that I would hire Mertz when I wanted to sell.”
– Randy Kastner, former Oconomowoc Tool & Die owner
Situation
The owner of Oconomowoc Tool & Die wanted to sell. He purchased the company five years earlier with the objective of significantly growing the company and then selling it to concentrate on unrelated business interests. Under his leadership, sales grew at a compound annual growth rate of over 36 percent.
The market of buyers for tool and die companies was fairly thin.
Scope of Mertz’s role
Mertz advised Oconomowoc Tool & Die in preparing offering materials, developing a customized database, contacting potential purchasers, evaluating and structuring proposals, and participating in negotiations with the purchaser.
The owner was sophisticated in the process of buying and selling companies, but he realized that he did not have the tools to appropriately market the company. While a mass marketing approach was not necessary or appropriate, aggressive selective marketing was.
The marketing plan included contacting:
- a comprehensive list of large national and regional tool and die companies
- strategically selected private equity groups with similar operations
- other intermediaries that are part of IMAP (International Network of Merger and Acquisition Partners)
- Mertz’s proprietary database of accountants, attorneys, bankers and other professionals (over 3,500)
Mertz developed interest and screened candidates, with only a few invited for a plant tour.
Private equity groups were the most active buyer group. For a variety of reasons, North Shore Capital emerged above the others. After detailed conversations and negotiations led by Mertz, the owner of Oconomowoc Tool & Die and North Shore Capital reached an agreement.
Mertz’s value add
Mertz effectively and efficiently identified, contacted and developed interest from a variety of buyer groups, which offered the owner options for a company with a thin market.