Steering Controls Company for sale $2.3M revenue, 26% EBITDA

The Company is an established, growing business specializing in the sales and service of industrial and off-road steering controls and their related service parts. The Company is located in the Midwest, United States. Founded in 1985, the Company reported $2,293,114 in 2023 revenue, up from $1,881,710 revenue in 2020. This revenue growth implies a CAGR of 6.8%. Pro forma adjusted EBITDA for 2023 was $599,685, or 26%, and average pro forma adjusted EBITDA in the years 2020 to 2023 was $555,533. This implies an average PF EBITDA margin of 27%, or 6.6x the industry average EBITDA of 4.1%.

The Company is known nationwide for its comprehensive selection and servicing of manual and power steering control devices for off-road machinery used in diverse industries such as material handling, agriculture, construction, aviation ground support, and off-road recreational vehicles. The Company supplies new assemblies and parts, rebuilt exchange units, and also rebuilds assemblies that are sent in from customers throughout the US.

The Company has outpaced industry competition by retaining an experienced workforce, sustaining solid customer and vendor relationships, maintaining deep industry expertise, and assiduously managing its facility, inventory and equipment. Average employee tenure is 15 years and, and 63% of employees have been with the company more than 10 years. Customer retention is strong, and over the past four years 84% of Company revenue came from customers who had been with the company for three years or more. The Company’s 20,000+ customers range from end users repairing their own equipment to large wholesale volume buyers and exporters. The Company’s financial position is further strengthened by its diverse customer base, and no one customer has contributed more than 7% of revenue in the past four years.

The Company has developed a proprietary database and processes that allow it to quickly identify and locate virtually any steering component or part. This database has been painstakingly compiled over the past 35 years and now comprises a list of over 35,000 unique parts from over 930 types of parts supplied by over 160 OEM and parts suppliers, all within a matter of minutes. The Company has also documented every step of its operational processes in detail including work order review, bidding, specs and drawings, job planning, materials including part numbers, estimation and project flow. Management maintains over 20,000 files of customer work orders and specs from its entire history. The Company enjoys solid brand equity from its 35 years in business.

The Company is headquartered in a 9,500 square foot building which contains a production shop and warehouse, office space, 12’ to 14’ clear heights, and three drive-in doors. The improvements are situated on a 1.51-acre site zoned for light industrial use. The environment is designed to maximize operational efficiency, effectively manage an average of 2,700 customers per year, store and maintain equipment, inventory and supplies and provide adequate space for office operations of the Company’s businesses. The Company also owns and maintains over 171 pieces of machinery, equipment, vehicles and fixtures for use in its operations, valued at approximately $239 thousand on a fair market value basis. Current value of the land and facility is estimated to be $575 thousand.

This recapitalization presents investors with the ability to participate in:

1. Excellent Brand Equity
2. Growing Customer Relationships with 84% retention
3. Strong Value Proposition to Customers
4. Detailed linked database of over 35,000 unique parts from 930 component types, from over 160 OEM and non-proprietary manufacturers
5. Documentation of over 20,000 Job and Customer Specifications
6. 117 Years of Collective Industry Expertise
7. Substantial Tangible Asset Value in Facilities
8. Attractive Long-Term Business Development Opportunities
9. 35 Years of Stable Cash Flow and Steady Growth