• Steel Pacific
  • Crossroads
  • CCI Industries
  • Succession Planning

    To support an owner/manager’s plan to retire and sell his business, Yellow Point brought in a highly experienced management team which took a sizeable equity stake in the business and enabled the owner to liquidate his investment.

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  • Management Buyout

    Yellow Point partnered with senior management to acquire this high-performing company from its non-active shareholders. Over the ensuing years, the partnership’s significant success drove a considerable increase in equity value.

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  • Turnaround

    In this case study read how Yellow Point partnered with senior management to turn an over-extended company which was experiencing severe financial challenges into a market leader.

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  • Scenario
    An owner/manager was looking to put a succession plan in place to retire and sell his business, Budget Steel, Vancouver Island’s largest metal recycling business.

    Approach
    With his blessing, Yellow Point approached Harper’s recycling, a successful competitor with a young, aggressive management team. Yellow Point merged Budget and Harper to form Steel Pacific in 2006, with management taking a considerable equity ownership stake.

    Yellow Point and management worked collaboratively to enhance the board of directors, improve the profitability of the business by initiating several operational improvements, complete complementary strategic acquisitions to diversify the business and implement management information systems.

    Result
    Yellow Point managed the exit process, facilitating a focused and limited auction process which resulted in the sale to strategic buyer Schnitzer Steel in December 2010.

    Outcome
    One of our management partners from Steel Pacific is now contentedly pursuing his love of exotic cars and driving a Ferrari.

  • Scenario
    Two retired former senior managers of Crossroads, western Canada’s largest distributor of mechanical insulation, were looking to sell their ownership stakes in the business.

    Approach
    Yellow Point structured a buyout which allowed the former managers to exit entirely, the CEO to sell a portion of his holdings and put a succession plan in place, and several current Crossroads managers to invest in the future ownership of the company.

    Yellow Point attracted a value-added board member who eventually took over as CEO to realize the prior CEO’s three-year succession plan. Management significantly grew the company’s leading market share, supplying nearly all the major Alberta oil sands projects and growing its value-added fabrication business.

    Result
    Over the four years of Yellow Point’s partnership, EBITDA grew at a compound annual rate of 25%. On July 20, 2012, Yellow Point successfully exited its investment in Crossroads C&I via a sale of the business to Distribution International, a Houston-based insulation distribution company.

    Outcome
    One of Crossroads’ management partners is realizing his goal of travelling around the world.

  • Scenario
    CCI Industries, a leading manufacturer of concrete block products, had undertaken a major expansion which overextended the firm and resulted in the company being unable to meet its financial obligations.

    Approach
    Yellow Point structured, negotiated and funded a settlement with creditors, invested capital, and worked with our management partners to turn the business around. We attracted a new CEO and assisted in facilitating several operational improvements including streamlining the product mix, negotiating improvements to supply and distribution agreements, and improving manufacturing efficiency.

    Result
    CCI regained its market-leading position and grew its EBITDA at a compound annual growth rate of 83% over the five years Yellow Point was involved in the partnership. In December 2009, Yellow Point engineered the sale of CCI Industries to strategic buyer Expocrete Concrete Products.

    Outcome
    With a life-long dream of living by the beach, one of CCI’s senior management has now retired to the Island of St. Lucia.