Welcome to the August issue of ACM Capital Partners’ Value Line newsletter. In this special issue you will find details of a unique transaction that highlights the completion of ACM’s successful receivership of a mulch manufacturer in Lake City, Florida.
MARTIN AND ACM COMPLETE SUCCESSFUL RECEIVERSHIP FOR CORBITT MANUFACTURING
The firm announced today that it has completed its work as the court appointed receiver for this specialty wood manufacturer in Lake City, Florida.
During the course of this seven month receivership, Martin and his team led the $20M Company to a turnaround and ultimately sold two divisions on behalf of multiple creditors and constituents for a combined forward multiple of 5x adjusted EBITDA.
Martin and his team eliminated $1.5M in direct costs which significantly enhanced the operating margin, while they improved customer relationships. They also secured new customer relationships and in one case, despite operating out of a receivership, were successful in landing a new 2013 award from The Home Depot for its firewood product. The buyer from The Home Depot remarked to ACM professionals that he had never experienced a receivership in operation prior to this one where the service and delivery actually improved.
The firewood award and other new business allowed Martin and his team to sell the firewood division which had been shut down by the new buyers for a significant multiple and, most importantly, saved 50 jobs in an economically challenged area of Florida. The buyer of the firewood business, Suwannee Lumber, stated through its owner Frank “Bump” Faircloth that, “we would not have been interested in pursuing the firewood business nor the purchase of the plant in Lake City had ACM not done the work that they did with The Home Depot and other new customers.”
The original mulch (and firewood) division was marketed by ACM as a going concern in March of 2012 which led to 12 interested buyers. Ultimately, Oldcastle Lawn & Garden submitted the highest and best bid and closed the acquisition in June at an implied multiple of 4.5x adjusted EBITDA. Said Scott Salmon, president of Oldcastle Lawn & Garden a subsidiary of the $17 billion privately held giant, “Jim and his team did a flawless job of turning this business around and led a professional transition which made our jobs much easier in the process.”
In his final review of the Corbitt Receivership, Jim Martin, Managing Partner of ACM, stated the following: “I commend our team, especially Mark Deleo, for their hard work and dedication. We are very proud of the job we did in the turnaround, the sale process and most importantly the preservation of 50 jobs for the dedicated employees of Corbitt Manufacturing. We are also proud of the fact that the cost of our professionals in this engagement was borne by the positive cash flow savings we achieved in the business and not from the cash collateral of the secured lender – a rarity.”
ACM COMPLETES DAILY BUSINESS REVIEW VOTE
ACM is included as a nominee for “Best Trustee” in the Daily Business Review’s BEST OF survey. Please hit “next” to question #38!!! The voting period is now through Sept. 21st. In November, the DBR will publish a magazine that will include the top 3 companies in each category. Click the below link and vote now!”