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 The
Fortune Group was retained by ADCO Global, Inc., a portfolio
company of Aurora Capital Group, when it determined that its
Plastic Sheet and Profile Extrusion Division was not compatible
with its core competency, specialty adhesives. Management
intended to implement an aggressive plan for acquisition growth
to expand its core business while divesting the Plastics Division.
The Plastics division of ADCO Global consisted of one plant
operating in Evansville, Indiana and, although respected in
the industry, was not large enough to match the operating
and financial resources of two relatively large national companies
it competed with. As a stand-alone operation, the operating
results were not sufficient to justify a valuation as a going
concern larger than the current book value of the division.
The Fortune Group selectively marketed the Plastics Division
to only a few national companies considered by management
and The Fortune Group to have enough synergies with the operation
to maximize the value to ADCO Global, Inc.
This Plastics Division was ultimately divested in two separate
transactions: (1) Spartech Corporation, the largest custom
plastic sheet manufacturer in North America, acquired the
Plastics Division working capital and some of the equipment
for relocation to one of the existing operations, and (2)
the real estate was sold virtually simultaneously to an unrelated
third party.
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