Manufacturing Co - Aftermarket Heavy Duty Truck Parts - Noncyclical
Overview
We have recently executed an LOI on a platform investment for Alitus Partners. The company is largely focused on a sizable niche in the aftermarket heavy duty truck parts segment of the automotive industry. The business has grown steadily over its 31 year history, and is now roughly $29m revenue and $7.5m EBITDA. This is a $60m asset deal, and we expect to have a relatively conservative capital structure in place at closing as we pursue aggressive growth opportunities. We are targeting 3.5x total debt, and approximately $31m of new equity (the sellers are rolling 10-20% of their equity into the NewCo). The company grew through the last recession, and has had only one year of negative revenue growth over the last 17 years…and that was a decline of 1%. Margins have consistently improved as the business has scaled. The owners are conservative by nature, which has led to a strong foundation and continued investment in the business and its people and facilities. The majority owner – and son of the founder – is looking to exit as the business is outpacing his ability to realize growth opportunities and effectively manage the company. The company is run by a non-family President, whom we believe has the capability to lead the business through the next several stages of growth.
About the Family
Alitus Partners was created following the successful exit of the founder from one of North America's largest plastic packaging manufacturers in 2015. The family office was formed to provide small business owners with the capital and operating expertise to enhance growth and support infrastructure development. The founder and operating partners have more than 100 years of operating experience, each having built their businesses into leaders in their respective industries. We understand the operating and growth hurdles that small business owners face and we work with our management teams to overcome those obstacles by providing strategic guidance and operational resources. We are long-term investors and as such, we take the time to position each business for sustained growth through our 10- to 15-year hold period. We want to use our experience to help other small businesses realize the same growth that we have experienced, and we do that through a hands-on, operationally-focused approach.