Garvin Industries, Inc. acquired by Southwire Company, LLC
How a fourth-generation business owner secured his family business’s legacy
Business Activity
A leading manufacturer of electrical, low voltage and lighting products for the construction industry in the United States.
Founded
Late 1800s
Sold
August 2018
Location
Franklin Park, Illinois
Buyer
Southwire Company, LLC
Background
Founded in the late 1800s by Sam Garvin, Garvin Industries, Inc. (“Garvin” or the “Company”) is a leading manufacturer of electrical, low voltage and lighting products for the construction industry, based in Franklin Park, Illinois.
Bart Garvin is Sam’s great grandson and the fourth generation to run the business. Under his leadership, the Company developed a non-traditional “go-to-market” strategy, selling their products directly to electrical contractors through their website, thereby bypassing distributors and sales agents. The innovation drove significant growth and record profits. Recognizing that he was constrained in his ability to focus on the company’s expansion while managing increasing daily operational demands, Bart decided to engage Northern Edge and pursue a company sale.
Led by a senior Northern Edge deal team, this transaction involved expert positioning of the Company’s online “Amazon-like” experience for their customers along with direct phone outreach to over 150 select parties resulting in over a dozen of meetings with industry leading strategic and financial buyers. This was followed by well-orchestrated bidding rounds and skilled guidance throughout the due diligence phase, ultimately delivering the optimal price, deal structure and long-term partner for Bart’s family, the company and their employees.
Looking back at the lessons learned during this process, Bart had this piece of advice for business owners considering a sale:
“The single most important thing is to cast of vision of greatness for your company… People like stories, they want to be taken on a journey, they invest in the future… ”
“So, as the business owner trying to get an attractive multiple for your business, it’s extremely important to cast that vision of greatness and make it concrete, make it tangible… Show them how you’re going to capitalize on the market, and give them specifics, the more documentation and data that you have and that you can present to a potential buyer, the better off you’re going to be and I really believe that drives multiples higher.”
Bart ultimately chose Southwire Company, LLC, itself a family business and one of North America’s largest wire and cable producers as well as an emerging influence in the industrial electrical space, as the buyer, motivated in part by the complementary nature of their products but also because of shared company values and a strong commitment to their employees and to supporting local communities.
This partnership has expanded distribution channels and cross-selling opportunities for both buyer and seller. It has also fulfilled Bart Garvin’s personal goals: Garvin’s employees will have a good future with a company willing to invest in its continued growth and he can now focus on areas he truly enjoys – product development and sales – while leaving the management of daily operations to Southwire.
The Northern Edge-advised acquisition of Garvin Industries by Southwire Company, LLC won M&A Deal of the Year ($25 –50 million) at the 18th Annual M&A Advisor Awards in 2019.
Bart’s tips for business owners:
- Timing is everything – ask yourself whether timing is right in your industry but also if it’s the right time for you personally and your company
- You are your company’s best salesperson, the one who can best present its attributes
- Cast a vision of greatness for your company and make it concrete, make it tangible. Show [your potential buyers] how you can capitalize on the market and give them specifics.