|We are excited to announce the acquisition of Buchanan Rubber Ltd. (“Buchanan”) as part of our growing distribution platform that includes Midland Metal Mfg. (“Midland”) and Anderson Metals, LLC (“Anderson”) under the umbrella of Wynnchurch Capital, LLC (“Wynnchurch”), our private equity partner. |
Vince Hodes, CEO, said in a statement, “With the addition of Buchanan, we can now offer additional products, with a full line of hose and couplings, as we continue to enhance our value proposition and execute on our growth strategy. We are excited to leverage decades of industry expertise, product knowhow and management talent to continue to grow our leading distribution platform. We also gain access to the Canadian market and drive continued scale in the industrial, energy, water, and infrastructure sectors. Wynnchurch continues to be a fantastic strategic partner, continuing to show their willingness to invest in great people and companies, to bring value to our customers.”
Jahan Roohi, co-owner of Buchanan, stated, “We’re excited about this new partnership with Wynnchurch and management and the tools and resources they bring to significantly grow our business as we take it to the next level.” Dave Merrick, co-owner of Buchanan, added, “This combination is not only a strong strategic fit with complementary products, geographies, and end-markets, but also an excellent cultural fit with our shared dedication to customer service and our employees. This is an exciting time for our business.”
Founded in 1986 and based in Toronto, Canada, Buchanan is a leading distributor of industrial hoses, couplings, and sheet rubber with approximately 8,000 SKUs. The company distributes products to a variety of end-markets including petrochemical/energy, construction, mining, water handling/agriculture, food & beverage, and general industrial.
For more information, please visit: www.buchananrubber.com
Founded in 1980 and based in Kansas City, MO, Midland is a distributor with over 13,000 SKUs comprising valves, fittings and related products. The company distributes to general industrial, hose, fluid power, plumbing, oil and gas, agriculture, water, truck and trailer, power transmission, and other end-markets.
For more information, please visit: www.midlandmetal.com
Founded in 1947 and based in Kansas City, MO, Anderson is a distributor and manufacturer with over 12,000 SKUs comprising valves, fittings, pipe nipples, and related products. The company distributes to plumbing, hardware, industrial, and other end-markets.
For more information, please visit: www.andersonmetals.com
About Wynnchurch Capital:
Wynnchurch Capital, LLC, headquartered in the Chicago suburb of Rosemont, Illinois, with offices in California and Canada was founded in 1999, and is a leading middle-market private equity investment firm. Wynnchurch’s strategy is to partner with middle market companies in the United States and Canada that possess the potential for substantial growth and profit improvement. Wynnchurch Capital manages a number of private equity funds with $2.2 billion of committed capital under management and specializes in recapitalizations, growth capital, management buyouts, corporate carve-outs and restructurings.
For more information, please visit: www.wynnchurch.com
Wornall Carwash Supply is a national distributor serving carwashes. One of their highest selling sku’s is a specialty stainless steel swivel fitting designed by their founder, Mr. Wornall. The fitting was being manufactured by a regional job shop that was struggling with a large backlog, resulting in long lead times and backorders for Wornall.
On a routine sales call, Midland’s sales rep heard about the frustrations that were the haunting Wornall due to the low inventory on their specialty swivel. Wornall wanted to change the subject as there was nothing he thought Midland could do about it, since it was a specially manufactured item. Midland’s sales rep introduced him to the Midland OEM Solutions program. With Midland OEM Solutions, Midland’s engineers work with distributors to engineer and manufacture specialty solutions.
Mr. Wornall provided Midland with a sample of the swivel, as well as design notes. Midland’s engineers worked with Mr. Wornall on understanding the functions and design advantages of the swivel. Midland provided Wornall with samples to approve. Once the samples were approved, Midland stocked a year’s worth of swivels for Wornall, lowering Wornall’s overhead and carrying costs.
Wornall Carwash Supply no longer had to worry about backorders on one of their best selling items. Midland kept completed stock of the swivel on hand for Wornall, decreasing their turnaround time on follow-up orders from 150 days to 2 days. In addition, by running production of the item in larger runs, Midland was able to lower Wornall’s cost of the swivel, increasing Wornall’s profit margin.
The end result for Wornall Carwash Supply working with the Midland OEM Solutions program was higher inventory turns since Wornall didn’t need to carry as large of an inventory on the parts since Midland stocked it for them. They also had higher gross profit margins since Midland was able to decrease the per unit cost by larger production runs. The combination of these factors brought about a much improved cash flow for the distributor.