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 Gammill
Inc. designs, assembles, and markets high-end quilting machines,
known as ‘longarm’ quilting machines, to quilting
enthusiasts and entrepreneurs. After developing and introducing
the first longarm quilting machine and spending 20 years building
the business the founder, Ken Gammill, at age 74, was ready
to retire. With no partners or management succession plan
in place, Mr. Gammill knew he needed help to realize the value.
The Fortune Group saw a couple of significant challenges
in this transaction. The longarm quilting machine market was
a small market niche and most potential buyers were unfamiliar
with this unique consumer product. Second, Mr. Gammill had
grown the Company by devoting his time to product development
and sales and marketing. Considerably less attention had been
given to financial management, industry intelligence and dealer
relationships.
After evaluating the situation, The Fortune Group devised
and helped implement a plan to address areas of strategic
importance and increase the value of the Company to a prospective
buyer. Drawing upon the resources of its principals and its
extensive network of other contacts, The Fortune Group assisted
the Company by:
- Identifying and arranging for the hiring of a Chief Financial
Officer which allowed the Company to begin producing timely,
accurate financial statements;
- Designing a dealer survey program that provided valuable
information the Company could use to design new product
offerings and forecast future sales;
- Developing market information about the size and growth
prospects for longarm quilting machines that was used in
discussions with prospective buyers; and
- Solidifying long-term relationships with key vendors to
avoid any disruption of supply during the sale transaction.
With the implementation of the plan, The Fortune Group resumed
its marketing activities and conducted a controlled auction
that that generated 18 written proposals to buy the company
from qualified buyers. After holding meetings with a small
number of these prospective buyers, Mr. Gammill sold the Company
in an all cash transaction to Champlain Capital LLC for an
amount that exceeded his initial sales price expectations
by more than 50%!
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