Metco Industrial acquired by Thoroughclean Australia

Our Client – The Vendor

Metco Industrial specialises in the design, assembly and manufacture of high pressure (4,000 to 40,000 psi) industrial water blasting equipment built to meet Australian conditions. Based in Adelaide, it services markets across Australia and the South Pacific, supplying industrial services firms with customised solutions for high pressure cleaning & surface preparation as well as cold cutting & hydro-demolition. The Business holds distribution agreements with leading global equipment brands and is recognised for its depth of technical expertise. Its ability to integrate a mix of high-end components with added safety features and purpose-built functionality positioned Metco as a niche value-added integrator.

Operating for over a decade, the Business had established three income streams – new equipment sales, consumable spare parts & components, and equipment rental – balancing projects with recurring revenue streams. Over the 5 years preceding the divestment process, Metco succeeded in doubling its turnover, whilst maintaining solid net margins. Metco’s owner sought to put in place a succession strategy that would identify a strategic acquirer who could take the Business to the next level. After considering several options for a sale process, including its own mid-tier national accounting firm, Metco’s Director engaged Johnsons Corporate as a specialist mid-market business broker to assist with selling the Business.

The Sales Strategy

For an acquirer Metco represented a profitable business, boasting a broad customer-base in the growing industrial services sector as well as a range of unique distribution agreements with leading global equipment brands. It was run by a reliable & stable team and had effective systems & processes in place for delivering outputs and managing its cost base. With strong demand drivers in downstream industries, the Business was well positioned for continued future growth.

Johnsons Corporate’s custom research & marketing focused on commercial enterprises in the Industrial Equipment Distribution sector – going beyond water blasting equipment to incorporate related industry segments such as hydraulic & centrifugal pumps, abrasive blasting products, tank vacuum equipment, and industrial equipment – and included major players in the global water blasting market. Johnsons ran a proactive direct marketing campaign that uncovered +35 qualified, interested parties. Further vetting and negotiations resulted in the selection of a preferred buyer as well as a backup buyer, with Offer and Acceptance secured within 12 weeks of going to market.

The Buyer

ThoroughClean is a QLD manufacturer of mid-range high pressure water cleaners (2,000 to 15,000 psi) supplying several market sectors. The acquisition of Metco was a significant step in broadening the company’s supply base & diversifying its offering with the objective of becoming the leading supplier of high-pressure solutions across Australia & New Zealand.

Paramount Safety Products acquires Pratt Safety Systems

Our Client – The Buyer

Headquartered in Perth, Paramount Safety Products is the name behind the well-known Prochoice brand of industrial safety gear. Servicing Australian and overseas customers for over 20 years, the Business acts as a manufacturer and distributor of personal protective equipment (“PPE”), which it supplies to a wide range of industry sectors. By 2015 Paramount was the third largest wholesaler/supplier of PPE in Australia – turning over +$50 million and operating a national network of warehouses located in WA, NSW, VIC, QLD as well as New Zealand. 

Aiming to position Paramount as a leading Australian, one-stop supplier of quality industrial products – distributed throughout ANZ and exported across the Pacific Rim and beyond – the board of directors determined the Business should pursue future growth through strategic acquisitions. Specifically it mandated the diversification of the product range in addition to broadening the customer base and increasing revenues. Being well aware of the pitfalls of managing acquisitions internally, Paramount’s directors sought advisors to undertake an acquisition campaign on their behalf. They engaged Johnsons as specialist mid-market business brokers to provide expert assistance, covering the identification and qualification of suitable targets, the management of price expectations, and the strict oversight of the exchange of information between multiple stakeholders.

The Acquisition Strategy

Johnsons worked to a clear acquisition brief. The ideal target was a business that would allow Paramount to leverage its national infrastructure and management team, while diversifying its product offering. Specific target attributes included: exposure to the industrial products sector, a portfolio of long-term customers, experienced management and staff, and a turnover range of $2M to $20M.

Custom research & marketing spanned a number of sectors complementary to Paramount’s core focus on Industrial Personal Protection Gear. Johnsons ran a proactive direct marketing campaign that uncovered 19 qualified, off-market acquisition targets. Further vetting and negotiations with a shortlist of preferred targets resulted in the execution of an Agreed Terms Sheet between the buyer and its top target.

The Acquired Target

Established over 40 years ago and based in Victoria, Pratt Safety Systems is a private, Australian family-owned business. For this well-known supplier of industrial safety goods, being acquired offered the Business access to national distribution infrastructure. In turn it could offer the purchaser a loyal customer base and complementary product range, including: dangerous goods safety cabinets, emergency showers & eye wash stations, spill containment, stormwater management, gas cylinder storage cages, and safety signs.