Case Study:
HUB City Industrial Supply, Inc.
| Company: |
HUB City Industrial Supply, Inc. |
| Buyer: |
Applied Industrial Technologies, Inc. (NYSE: AIT) |
| Transaction Type: |
Sale Transaction |
Company Profile
- One of the nation's leading distributors of highly-customized industrial products, offering a diverse product portfolio of more than 37,000 SKUs, including branded and non-branded saw blades, safety products, abrasives and more
- Serves a number of niche markets, including the pallet and auto dismantling markets
- Sells to over 5,000 customers nationwide and has additional locations in Las Vegas, Nevada and Indianapolis, Indiana
Situation Overview
- The shareholders were seeking a majority sale at the highest possible price
- With an understanding of the buyer universe, we recommended approaching one buyer, Applied Industrial Technologies, with a "first look" opportunity
Marketing Process Summary
- Approached 1 buyer (Applied Industrial Technologies) with the threat of going broad if buyer did not pay a robust multiple off of a forward EBITDA projection and move quickly towards closing
- The 1 CIM sent to Applied Industrial Technologies was the only CIM sent out into the market
Outcome
- Hub Industrial Supply was sold to Applied Industrial Technologies
- Farlie Turner negotiated highly attractive terms, including a minimum level of working capital to be delivered at closing, limited indemnifications and appealing employee agreements
- Farlie Turner was successful in maximizing valuation and successfully closing the transaction on attractive terms without ever approaching other parties
