Industrial Test Equipment Manufacturer

Butler, PA (Butler County) (Relocatable)

Seller Financing Available
Industrial Test Equipment Manufacturer
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Asking Price: $1,200,000

Cash Flow: $180,000

Gross Revenue: $500,000

EBITDA: N/A

FF&E: N/A

Inventory: N/A

Established: 2001

Industrial Test Equipment Manufacturer

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Business Description

Profitable, Highly Scalable Hydrostatic Test Equipment Business

COMPANY OVERVIEW: The Company designs and sells hydrostatic test systems for both burst (short-term) and static testing (long-term) of plastic pipe and hose. Its burst testing systems are capable of testing large plastic pipe up to 3,000 psi, small plastic pipe up to 5,000 psi, and hoses up to 15,000 psi. Its static testing systems are capable of testing pipe, hose and fittings to the ASTM 1598 standard. It sells its systems primarily to pipe and hose manufacturers – the test systems ensure the safety and reliability of the OEM customers products to their end users. Founded in 2001, the Company has garnered a reputation for safety and reliability and is an approved vendor for many large pipe businesses throughout the United States with customers such as Honeywell, Chevron, and JM Eagle and utilities like Consolidated Edison and Southern California Gas (LA).

The Company designs and assembles its test systems. It does not manufacture any semi-finished components. It purchases components and outsources all of its metal fabrication and painting requirements. The company also services, repairs, refurbishes and calibrates test systems.

FINANCIAL OVERVIEW: 95% of the Company’s sales are of new systems. Over last three (3) years annual revenue has been in the range of $450,000 to $500,000. The Company regularly achieves 40% to 50% Gross Profit margins. The current owner has enjoyed discretionary earnings of $150,000 to $180,000 per year over that same period of time. The current owner is the only full-time employee of the business. Also important to the business are a contracted software programmer and a metal fabrication shop providing all of the test system enclosures. Contract labor is utilized as needed to support the assembly of new systems.

GROWTH STRATEGY: The owner believes the product line could easily be grown to $2 million or more in annual sales through a consistent sales effort supported by a new website with online ordering and a digital marketing campaign for lead generation. Significant sales growth would allow the Company to support a full-time sales and service associate. The current owner believes the European market represents an excellent opportunity for growth.

TRANSACTION OVERVIEW: The current owner has worked in the business for over 40 years. He is wanting to sell and transition the business to a new owner and retire. The seller is 60 and currently willing to stay on with the business as a contractor or consultant for up to three (3) additional years. The seller is willing to finance a part of a buyer’s acquisition of the business. The Company, currently located in Western Pennsylvania where it operates out of a 2,000 square foot shop, could easily be relocated anywhere in the United States.

The asking price of $1,200,000 includes the intellectual property related to the systems, inventory of parts and supplies, equipment, proprietary software, the customer list including the list of installed units, and a non-compete with the owner. This business would be well suited as an add-on to an existing business that is either: (i) selling or is looking to sell to pipe and hose manufacturers or (ii) sells other industrial testing systems or for a mechanically inclined entrepreneurial owner.

Detailed Information

Location:
Butler, PA
Inventory:
Included in asking price
Employees:
1
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Anthony Ventura

Business Listed By:
Anthony Ventura

Redshift Advisors

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