Case #928

$100 million plumbing fixtures company

The Challenge This leading manufacturer and supplier of residential, commercial and institutional plumbing products had seen gross margins erode throughout the 1990’s as its industry globalized, thanks to cheap imports and 30-50% cost advantages through U.S.-China trade. Struggling with $20 million in debt, the Midwestern-based company was losing millions a year and found itself in default with its senior lender. The company was headed for liquidation.

The Solution Morris Anderson & Associates outsourced 1/3 of the production from domestic to overseas, and developed a strategy to move the company from pure clay manufacturing to distribution by leveraging the company's brand and channel strength.

Morris-Anderson & Associates then facilitated the sale of the company through a Chicago investment-banking firm while controlling cash, keeping the company alive. The original lender got out whole, new capital was attracted and the owners received equity in the new company.