Case Study

Strategic research and in-depth knowledge of financial buyers help Fortune 500 Company find successful acquirer of international division.

Client
Allen PPM Business of FMC Technologies
Business category
Industrial manufacturing – Capital Goods
Food processing equipment
International

Sale background
Our client: The Allen PPM Division of FMC Technologies was the result of combining two businesses that manufactured food processing equipment for the snack food industry. Started in the 1040’s, Allen was located in Newberg, Oregon, and PPM was located in Sweden. Both companies manufactured and installed food processing equipment for the snack food industry and were combined by FMC Technologies into one company in 2004. The companies source components and market their finished equipment internationally.

The buyer: LJW Global Equities, located in Chicago, Illinois, was seeking a profitable manufacturing company with an international presence. LJW had come to the attention of Stevenson in a personal meeting in 2006 and was one of over 200 financial investment groups and strategic buyers that Stevenson contacted. It immediately saw that the Allen PPM acquisition would meet its needs and aggressively pursued the acquisition.

Why Stevenson & Company was retained
Stevenson and Company had successfully sold another capital equipment manufacturing company for FMC Technologies in 1999. FMC Technologies has an excellent Corporate Development department that is capable of handling a divestiture such as Allen PPM, but it was committed to other growth opportunities for the corporation. FMC decided the best use of its manpower was to keep its Corporate Development focused on growth opportunities and retain Stevenson to accomplish this and other divestitures.

The Stevenson Advantage
Stevenson & Company’s unique ability to contact and deal successfully with both strategic industry buyers and with private equity investment groups and its knowledge of manufacturing operations made it uniquely qualified to accomplishment this sale. Stevenson:

• Prepared marketing materials that highlighted the unique selling points of these divisions
• Identified and contacted both strategic and private equity group buyers
• Arranged management presentations by Allen PPM management for a number of qualified buyers
• Created competition among buyers by developing several interested acquirers
• Worked through several financial structures in negotiations with the parties until the transaction could be successfully financed and closed

Deal summary and results
As a result of Stevenson & Company’s efforts in the successful transaction:

• A purchase price was obtained that was considerably in excess of Allen PPM’s value on FMC books and thus could be booked as a substantial profit.
• A transaction was negotiated that kept most of the divisions’ personnel and benefits at a level consistent with FMC’s policies
• Momentum of the transaction was maintained through periods of changing forecasts and profitability and with several financing sources that the buyer introduced

Client response
Our client’s satisfaction was demonstrated by its decision to contract Stevenson & Company for the sale of several other divisions.