Hussey Seating Company

Hussey Seating Company

A family-owned company discontinued a division. The deduction of all the related non-recurring expenses caused its operating statements to show an operating loss and a negative net worth. The point in the firm’s annual business cycle required additional working capital and the company wanted to keep its bank borrowing lines available to it. The company had had its 232,000 SF office building and manufacturing facility appraised for $3.3 million. Their asset-based lender asked us if the value of Hussey’s real estate could provide a solution.

APPROACH

Our analysis included a comprehensive investigation of Hussey’s facilities, the Maine industrial market and the capital markets.

Our review of multiple years’ financials indicated that the core business was consistently profitable, in spite of the poor performance of the eliminated division. Our careful reading of the appraisal indicated to us that its methodology and conclusion were flawed. The Maine industrial market is relatively thin. All of the comparable properties were companies in Maine. In fact, a much more active industrial market existed in New Hampshire, many of which were much closer to Hussey than many of the Maine comparables in the appraisal.

We developed a real estate strategy, created an offering memorandum that made a compelling case that the core company business was strong and likely to continue to grow.During the process we also engaged an appraiser from New Hampshire to produce a new appraisal.

RESULTS

Our national marketing campaign produced 22 offers that were more than $6 million. The offers came from every corner of the country.

The ultimate buyer was a partnership where one partner was based in Seattle and the other in Palm Beach.

By concentrating on its core business, the company not only survived, but it thrived. In fact, within five years after the sale-leaseback transaction, Hussey Seating acquired Clarin Seating, the world leader in providing portable folding seats, lecture room learning systems and hospitality loose seating.