Business
A leading national supplier of private label bottled water, iced tea and flavored beverages to leading retailers across the U.S.
Transaction
In early 2005, one of LaSalle’s operating advisors introduced LaSalle to Advanced H2O’s founder and CEO, Bob Abramowitz. Bob needed a financial partner to provide capital for further expansion and to consolidate the Company’s fragmented ownership base. LaSalle partnered with Bob and his management team to recapitalize the Company and provide financing to expand and modernize the existing production facility.
Opportunity
LaSalle saw an opportunity to grow Advanced H2O organically into a leading supplier of private label bottled water on the West Coast. Demand for private label bottled water was growing rapidly as consumers shifted their buying preferences to healthier and more convenient bottled water. The Company had a strong CEO and COO and a premier customer base of leading grocery, club and big box retailers. It needed a strong financial partner with operational expertise to continue its growth trajectory, add management depth, lower plant operating costs and increase production efficiencies.
Growth Strategy
The first phase of the growth plan focused on expanding and modernizing the Company’s existing facility and equipment to meet growing customer demand. We consolidated the warehousing and production facilities and added a new high-speed bottling line, more than doubling capacity. We also vertically integrated the Company’s primary raw material vendor into the newly expanded facility which significantly reduced costs and improved working capital. We also implemented commodity hedging strategies to minimize the Company’s exposure to resin and freight price increases. This allowed the Company to become the low-cost producer in the region and dramatically increase volumes with its existing leading retail customers.
The next phase of growth involved expanding the Company’s customer base and geographic footprint. We recruited additional management resources in sales, finance and logistics to support the growth plan. As volumes continued to increase, we quickly needed to add capacity and expand into a new geographic territory to meet customer demands. We invested additional capital to establish a second state-of-the-art bottling plant in Northern California, which further lowered costs through production efficiencies and freight savings and enabled us to target new customers in California.
We sold the business in December 2007 to a larger private equity fund, achieving a highly successful outcome for our investors.
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Deal Snapshot
Organic growth story
Facility expansion and modernization
Doubled revenue and tripled EBITDA in 2.5 years
Acquired June 2005, Exited December 2007
“LaSalle Capital had the vision to see the possibilities for our company. They provided the financial and operational resources we needed to take advantage of our growth opportunities.”
Bob Abramowitz
CEO, Advanced H2O |
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