Case Study

Overview

• TransGo is a specialty manufacturer and designer of automotive transmission valve body parts that are used to repair faulty transmissions in the aftermarket. Due to the technical nature of TransGo’s service offering, the Company consistently generated EBITDA margins in excess of 60%.
• While other companies in space with comparable market share had approximately 11x the employees and 20x the marketing budget as TransGo, the Company relied solely on its reputation, quality products, and best in-class service to continuously drive growth.
• Five Points Capital understood the complexity of the situation, but could also see the tremendous potential that TransGo could grab if it had the correct financial and operating partner.

Situation

• TransGo’s president, who learned the business from his mentor, Gil Younger, was motivated to sell the business so that he could fulfill a promise to Gil which was to sell the business and donate a majority of the proceeds to charity.
• TransGo’s top customer, which represented almost 50% of total revenue, declared Chapter 11 during the process.

Cascadia Process

• Cascadia Capital positioned TransGo around future growth potential and the ability for the company’s products to expand within a growing market.
• Cascadia ran a tailored process speaking to a select group of parties who presented the best cultural fit with TransGo’s unique story.
• Cascadia leveraged its expertise in negotiating and running complex diligence processes while managing this deal process so that TransGo’s president could focus on running his business.