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Is Your Company Worth More Than a Market Multiple
We’ve all heard about the competitor who sold his company for eight times EBITDA. Presto, you extrapolate an 8X multiple for your business and that’s a lot of money. As a success fee-oriented partner, we are just as enthusiastic about getting you the best price and terms for your company as you. Know that all businesses are unique and no two bring the same management, competitive advantage or business profile. As a result, it’s important to engage an experienced intermediary who will review your strengths and weaknesses and research market comps to determine a general valuation range for your company.
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RedStone
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$7.7M REV, $2.1M Adj. EBITDA Branded Fruit Processing Equipment Manufacturer and Rental Co.
- Revenue:$7.7M 2025
- Cash Flow:Adj. EBITDA $2.1M 2025
- Inventory:$4M
- Location:USA
The absentee shareholders of RedStone, a branded fruit processing equipment manufacturer with over 90 years of operations, seek a new owner. The company manufactures and rents highly automated equipment for several niche fruit processing applications. RedStone assembles its products in-house and leases them to national and international food processors. Average customer tenure of the top 10 customers has been over 30 years. RedStone has begun expanding its rental fleet recently and will have over 540 machines under leases by the end of the year.
The Company has in-house design and engineering capabilities. It is launching a new patent pending machine for a new fruit this year. This machine is already under a test lease with a customer who expressed interest in several machines. Redstone’s 15 employees provide all facets of its operations today. The Company’s President has strong experience in the food processing industry and can remain with the business post-transaction. With that said, he’s also open to a transition to a new President with experience in machine manufacturing or fruit processing. RedStone also engages agents and contractors in various parts of the world to support its sales and service efforts.
This business has been owned by a large and diversified family office for more than 60 years. With current shareholders in their 60’s and 70’s, they realize it’s time to let RedStone find another good home. As such, they seek a full exit. The family’s objective is to maximize the sales price through the sale to a financial or strategic buyer. This business could be an excellent acquisition for an experienced searcher looking to grow organically and through acquisition in the food processing equipment space.
BAMA believes the ideal buyer is either:
- A strategic buyer who can incorporate RedStone’s equipment manufacturing, parts and service business into their own portfolio of food processing equipment. Such a strategic buyer will enjoy RedStone’s long-term customer relationships and leasing model which drive consistent recurring and predictable base revenues.
- A financial buyer with experience in food & beverage equipment manufacturing can use RedStone as a mini platform to buy and build a diverse food processing equipment operation.
Facilities
The company owns an ±11,345 square foot facility (±1,500 SF Office Area) for equipment assembly, storage, and maintenance of machines. Real estate can be part of the transaction, or part of a sale leaseback arrangement. The Shareholders prefer to sell the company and its facilities together. They are also open to a FMV sale/leaseback with a third party or a short-term lease to a strategic who may want to integrate the operation into their own facilities.
Market
The food processing industry represents more than 200bn annually. It is highly fragmented with many niche manufacturers with specific equipment for unique food processing applications. RedStone provides machines for several unique processing applications, each having a variety of competitors globally. Due to its best of breed equipment, technology and yield, it wins in side by side competitive applications. It doesn’t spend a lot of money on sales and marketing and would benefit from tapping resources of a larger strategic buyer with dedicated sales resources and a global market presence as there is still substantial organic growth available domestically and globally.
$7.7M REV, $2.1M Adj. EBITDA Branded Fruit Processing Equipment Manufacturer and Rental Co.
Revenue
$7.7M 2025
Cash Flow
Adj. EBITDA $2.1M 2025
Location
USA
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ASTRO
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$7.5M Revenue, $1.6MM EBITDA Precision CNC/EDM Business ('25 Proj)
- Revenue:$7,500,000
- Cash Flow:$1,600,000
- Inventory:$794,000
- Location:Southeast
ASTRO, a Southeast based complex part CNC and EDM machining business, holding AS9100D and ISO 9001:2015 certifications will make a great addition to strategic buyers; or financial buyers seeking a small platform in the SE. The Company enjoys great margins and specializes at low to mid-volume production (80%+ of sales). The remaining business supports customers with prototypes for what will often become future production parts. ASTRO serves a diverse set of industries including medical, aerospace, semiconductor, robotics, electronics, and more. The Company also excels at manufacturing components from a wide variety of metals including Stainless, Molybdenum, and Tungsten.
In business since the early 80s, ASTRO’s customers also include large companies, universities, and research organizations. Family Office Ownership is absentee. The owners enjoy a strong management team. They worked with them to transition the company from purely prototype to production parts over the last 10 years. They’ve also worked through transitioning the work force from older prototype machinists to younger production machinists. ASTRO employs 20 team members, 14 of which are machinists with an average age in the 40’s.ASTRO presents a great opportunity for a strategic buyer looking to consolidate its presence or enter a growing market. Finally, the business excels at complex yet highly automated precision machining, where they’ve adopted exceptional palletizing capabilities to drive lights-out machining.
Facilities
In 2022, to support growth, ASTRO added 4,100 square feet to accommodate new CNC machines and materials storage. The total square footage is now 21,703, and there is still room to grow on their 2.4-acre property. The company invested heavily in new equipment over the last 5 years. Buyers will find the equipment package quite current and capable.
Market Outlook / Competition
ASTRO operates in a large metropolitan area with strong technology and a healthcare-oriented region with ample opportunities to grow with existing customers and new accounts. They are highly recommended for their ability to make high quality, complex parts or manufacture hard-to-machine materials.
$7.5M Revenue, $1.6MM EBITDA Precision CNC/EDM Business ('25 Proj)
Revenue
$7,500,000
Cash Flow
$1,600,000
Location
Southeast
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LEO
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$22.5M revenue; ±$1.0M EBITDA ('24) Building Products Distributor
- Revenue:$22,500,000
- Cash Flow:$1,000,000
- Inventory:$6,000,000
- Location:Southeast
LEO is a Southeast-based building products distributor founded 20+ years ago. With multiple locations, LEO built a strong and diversified customer base primarily of professional contractors and installers. Most of their sales are generated from strong-margin flooring products (roughly 45% of sales) with the balance made up of wall materials, installation materials, mosaics, cabinetry, tools, etc. with a specialization in tile materials. They have a small but growing niche in the large size wall tile (exceeding 2’X4’).
Revenue trends the past couple of years have been $28.7M in 2023, $22.5M in 2024, $22.5M in projected revenue for 2025. Gross margins consistently fall in the 43-45% range while EBITDA was $2.76M, $1M, $1M (Proj) respectively. LEO typically carries $6M in inventory which remains consistent throughout the year. The average ticket over the past two years is $247. They have a well-diversified, recurring customer base. In 2023 and 2024, LEO’s top ten customers generated approx. 27% of total revenue across 42,249 tickets ($7.6M revenue) and 33,534 tickets ($6.2M revenue).
The business is owned by an ESOP and an independent trustee who has the sole voting power has agreed that the Company should review strategic sale options. LEO has over $3M in cash on its balance sheet and has no debt (ESOP loans are paid off).
LEO presents a great opportunity for strategic buyers to expand their presence in phenomenal markets with an established customer base and healthy gross margins. Ownership seeks strategic buyers as there are many cost saving synergies that would immediately improve the bottom line of this business. LEO has a great team, product offering, and customer base in a high-end, densely populated growing areas where many people are moving daily and are building or upgrading homes.
Facilities
LEO operates from four locations, including a Company HQ with corporate offices and three retail stores located in fast-growing markets in the Southeast. All the facilities are leased from a third party, and the three stores are approximately 120,000 square feet combined.
Market Outlook / Competition
The domestic building products distribution market is expected to grow at an annual rate of 4% between 2025 and 2028, reaching $183.3Bn in this period. The U.S. flooring market is expected to grow at a CAGR of 3.8% until 2030 with the global flooring market expected to grow at 6.8%. The residential sector accounts for approx. 52% of revenue generation in the U.S. flooring market – tile and stone are seeing an increase in demand within the residential. The Southeast is the strongest region due to rapid population growth. With interest rates expecting to gradually come down, the demand for new homes and multi-family developments is expected to accelerate the growth of the broader building products market and flooring market.
$22.5M revenue; ±$1.0M EBITDA ('24) Building Products Distributor
Revenue
$22,500,000
Cash Flow
$1,000,000
Location
Southeast