Griffin Serves as Exclusive Investment Banker to Applied Controls

Company Overview

Applied Controls, Inc. was an ESOP-owned company based in Malvern, PA. The company was founded in 1969 by Bill Parker and is now a premier, value-added distributor of automation, machine vision and robotics products in the Mid-Atlantic region. Applied Controls has grown into a full-service authorized dealer for some of the leading brands in the industry including Siemens, Cognex and Universal Robots. In 1990, Jim and Rick Gehring purchased the company and later sold it through an ESOP transaction in 2013.

Situation

Given the continued success and growth of Applied Controls, coupled with the rapid consolidation of the automation products distribution industry in the last few years, the board and management team decided it was an opportune time to explore a sale of the business and maximize value for the employee shareholders. In addition, the company was well-positioned for a strategic acquirer, as it completed a management transition plan with Chuck Mulcrone’s promotion to President in 2021 and the current CEO, Jim Gehring, planning to retire at the end of 2021. Ideally, the board and management felt a larger industry consolidator could provide the company with (i) the additional resources necessary to help continue its growth, (ii) a stronger competitive profile and (iii) increased career opportunities for its employees.

Solution

Applied Controls engaged Griffin Financial Group LLC as its exclusive investment banker to assist in the sale of the company. While management initially envisioned Griffin approaching just a handful of well-known industry consolidators with a high level of supplier overlap, Griffin convinced them to expand the buyer list slightly to include strategic acquirers with somewhat lower levels of supplier overlap. Griffin then launched a competitive sale process with this expanded buyer group, which generated multiple offers from buyers on the initial and expanded list. Ultimately the process concluded with the sale of the company to a buyer on the expanded list, SunSource Holdings, Inc., a portfolio company of Clayton Dubilier & Rice. SunSource, headquartered in Addison, IL, is North America’s largest distributor for Fluid Power & Motion Control solutions. Applied Controls will be part of the SunSource Industrial Automation business unit, the entire Applied Controls team will remain successfully running the company as they have for many years, and the Applied Controls name, supplier and customer relationships will continue as well.

For more information on this transaction, contact John A. Lee, Senior Managing Director, at 610.205.6106, Domenick F. Cristino, Vice President, at 610.205.6101, or Jeff R. Tallman, Associate, at 610.205.6013.

Close