THE DIVESTMENT CAMPAIGN
Our Client – The Vendor
Established for approximately 20 years, Air & Hydraulic Power Centre (AHPC) had developed into a specialist mining services player. It provides testing, repairs, maintenance and sales of hydraulic torque equipment, pneumatic tools, high pressure hydraulics and heavy lift equipment to the mining industry. Not being tied to specific brands means the Business can offer a mix of on-site and factory-based services that allows customers to streamline their internal processes. AHPC also manufactures several bespoke products to meet the specific needs of its clients.
At the time of sale, the Business operated as a stand-alone business unit within a much larger private business, which specialised in large-scale heavy engineering and fabrication works. Located in Western Australia, AHPC had been acquired when the original founder retired in 2007. In early 2013, following a strategic review, it was classified as non-core and earmarked for divestment. Johnsons Corporate was then engaged as a specialised mid-market business broker to undertake a strategic business sales campaign on behalf of its parent.
The Business Sale Strategy
As an acquisition AHPC presented a great bolt-on opportunity for a buyer within the sector seeking further growth. Having achieved 45% growth over 3 years, its four main sources of revenue comprised mobile on-site services, workshop services, product sales, and Naval Service work. With general demand for compliance services increasing, future growth opportunities included: expansion across the mining sector and diversification into new markets, e.g. oil rigs & infrastructure; extension of bespoke product lines and their distribution, and; full development of a fledgling hire equipment offer.
Johnsons Corporate’s custom research & marketing focused on commercial enterprises in Australia’s Hydraulics Engineering and Mining Services sectors. It also incorporated targets from related market sectors, including: Lifting and Rigging Equipment, Torque Equipment & Pumps, and Mobile & On-site Equipment Repairers. Johnsons ran a proactive direct marketing campaign that uncovered +22 qualified, interested parties. Further vetting and negotiations resulted in the selection of a preferred buyer, with Offer and Acceptance secured within 4 weeks of going to market.
(Read more about how using a Specialised Mid-Market Business Broker Approach to selling your business could get you a better outcome – just like our client).
The Australian Trade Buyer
The purchaser, Pacific Hoists Pty Ltd, which provides materials handling and lifting equipment services, was identified through primary market research. It is a privately owned, family business founded in 1976 that offers national networks to service its customers promptly and professionally while maintaining a market leading position in both Australia and New Zealand.
What Our Client Had to Say
"Within 2 weeks of going-to-market Johnsons Corporate generated 30 expressions of interest from related industry buyers. Within 4 weeks they had secured Offer & Acceptance. We were impressed with the way Johnsons managed the divestment process from beginning to end and the final result was a great outcome."Peter Baker, Director - Baker & Provan