By Lloyd Graff
The last time I talked about Brad and Jeff Ohlemacher of EMC Precision Machining they were crowing about convincing President Obama to put on safety glasses before he toured their Elymira, Ohio, plant.
Today they are back in the limelight after closing a deal to buy fellow fourth generation machining company—Biddle Manufacturing of Sheridan, Indiana.
The Ohlemacher and Biddle (Myers) families knew each other from the Precision Machined Products Association (PMPA), but their fortunes diverged in recent years.
Biddle gravitated toward high production work, buying Hydromats and developing an in-house capability in plating, heat-treating, and electrochemical deburring. EMC brought in more CNC equipment while honing an expertise in “emergency machining,” for cases such as when customers need a firm to step in when their former supplier fails or suffers an operational blowout.
There is very little customer overlap, but Brad Ohlemacher tells me that Biddle customers seem extremely relieved that a financially strong, technically sophisticated company is taking over the Indiana firm.
Biddle was burdened with big legacy costs, and a bank that was fearful about the sustainability of the company. The selling family was faced with the potential liquidation of Biddle or selling the assets to EMC, which pledged to keep the workforce working—but without the legacy costs.
This could be a great deal for Brad and Jeff, who called me after celebrating with a single malt scotch at the bar in the Indianapolis airport. They’ve been looking to expand and diversify their machining portfolio since the recession took hold. With their strong banking relationships they felt they could pick up a distressed, but viable company that would compliment EMC’s strengths in super fast turnarounds.
I expect to see a lot of deals like this over the next year as the thirst for sparse capital pushes good companies like Biddle into the arms of financially able companies like EMC.
Question: If you were buying an established machining company would you attribute a lot of value to the preexisting skilled workforce?
