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Case Study: Transtar

Industry
distribution
Value Add
  • Organizational Design / Development
  • Product / Customer Planning
  • Acquisitions / Divestitures
Results
  • Five year hold period (2005-2010).
  • Doubled the size of the business and improved EBITDA margins.
  • Sold to Freidman, Fleischer, and Lowe.

Transtar

Distributor and remanufacturer of aftermarket transmission repair parts, transmissions, and a manufacturer of automotive refinishing products.

Investment Thesis & Background

  • Acquired Transtar as an opportunity to create long-term value through organic sales initiatives and add-on acquisitions.
  • Transtar was a market leader with a defensible value proposition serving as the key intermediary between large suppliers and small repair shops.
  • Company had a 30 year history of sales growth through multiple economic cycles.
  • Exceptional margins indicative of the value-add in the model, while opportunity for margin expansion and working capital improvement would drive additional value.
  • Founder CEO was seeking a succession plan during our ownership period.

Actions Taken During Ownership

  • Recruited a professional executive as President and completed succession plan the following year.
  • Completed three strategic acquisitions which added geography, opened new channels and expanded the product line
  • The Axiom acquisition was “game changing” and created the undisputed industry leader.
  • Improved margins, delivery routes and rebate agreements.
  • Reduced debt through improved working capital management.

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