AAA’s family owners wanted to focus on a proprietary rail products division and sought buyers for their precision machining business.
AAA is a good example of taking a carve-out business and building it out with the full resources it needs to be successful.
AAA is a precision machining company headquartered in Angola, Indiana. The company’s products are large, complex machined iron castings such as tractor frames, transmission cases and axle housings for agricultural, off-highway, heavy truck and automotive uses.
AAA’s family owners wanted to focus on a proprietary rail products division and sought buyers for their precision machining business. In AAA, we saw an operation with good equipment and technical capabilities in an attractive niche, but an underdeveloped organization, especially in the finance and sales functions. We believed AAA’s strong reputation and strategic location made it a good platform on which to add strategic acquisitions that provided diversification and capacity.
THE DEAL + OPERATING THESES
IOP purchased the machining business and established a number of operating theses for the investment. We needed to staff the new standalone business, with talent especially needed in finance, IT, HR and procurement areas. We also aimed to expand product breadth and manufacturing footprint. In the fragmented machining industry we wanted a broader, more strategic network of facilities to serve demanding customers.
THE PARTNERSHIP + RESULTS
The partnership has achieved a number of key initiatives:
Today, we continue to build AAA for long-term success. The company has a balanced book of business with diversity in markets, customers and programs. We plan to continue to grow the company organically and seek strategically complementary acquisitions.