The Company

Avkem International, LLC

A leading supplier of non-ferrous metal consumables and foundry chemical solutions

The Challenge

This Tennessee based company supplied chemical and other consumable products used in the non-ferrous metal production industry. The company had made several acquisitions that were poorly executed and wasted significant time and money in the process. In addition, they unwisely closed a facility that put the company at a logistical disadvantage that led to the loss of almost 50% of sales. With limited working capital, the secured lender had the company under forbearance and after using multiple turnaround consultants, they were out of patience.

The Process

Equity Partners quickly ran an extensive marketing process and determined that there were no buyers for the business as an entirety. Instead, the best way to maximize value was to split the company into two business units: flux and refractory. This required soliciting and negotiating bids from multiple groups for each unit.

The Solution

An offer from a competitor on the flux business was negotiated and accepted while a group of former employees/insiders purchased the assets of the refractory business. The closings occurred concurrently to avoid any interruption to customers and vendors were able to continue working with both companies, which were now properly capitalized.