I get all kinds of emails from banks, loan brokers, private equity groups, equipment appraisers, etc., but I’ve never received an email quite like this. A company is seeking to acquire complete manufacturing plants, including equipment and raw materials to ship overseas. They consider the destination a competitive advantage, and will not divulge the location of where your plant will be shipped until the last minute. Then they ask the seller to travel to that destination to re-assemble the plant and get it operational again.
The email itself makes for interesting reading. Here are sections of it:
“We buy an on going manufacturing plant, disassemble, export, re-assemble at the destination and produce the same product.
Here are some examples of why our tools actually help the seller:
A worn out labor intensive plant which can not function efficiently, can not compete in the
Our approach provides an opportunity for the seller to dispose of old equipment at a reasonable price without resorting to auction or scrap metal value, and purchases more efficient equipment, upgrading its plant, then sell it for much more profit. Case in point, recently we bought the equipment of a Mexican cheese factory in
Many manufacturers have older machines sitting in the yard covered with plastic sheet waiting for an unsuspecting buyer who will pay them a pretty penny to buy their rusted used machines. Meanwhile carrying such ASSETS on their books to entice a lender to loan them money for their current operation, question is does this approach work? They will search all over the country for a puffed up assets to be financed and driving the commercial mortgage brokers out of their minds. The same manufacturer can organize a mini plant with its old equipment by cleaning, repairing and painting such machines and sell it as a small unit plant however labor intensive this may be. At the present we have 3 manufacturers who put together such mini plants while buying used equipment from different unsuspecting sources and have a considerable sideline business. Two out of three have succeeded to sell additional raw material (they call it patented) and technical know how along the way too.
Seller needs to sell because he can not get financing for whatever reason to continue his business. It is very common that most business owners during good market conditions have over extended themselves, and are not able to compete any longer. The ailments are cured by CH11, lay offs, closure of certain portion of the plant, financing all their last personal assets with hard money loans. We provide a solution by new long term financing for new more efficient equipment and buy the old plant to export.
We have 6 foreign destinations which we ship and install plants. These being the secret of our business, we do not want to attract unnecessary competition, and at the same time it does not concern the broker or the seller, so we do not divulge the destination until the last minute when machinery is packaged to be shipped, so we ask you not to ask where it will be shipped, we will not tell you, and if this is an important issue with you, please do not continue with us.
We will give the seller the approximate date of arrival to destination. This is time for the seller to get his passport and make arrangements for departure to go and assemble the equipment at the destination. Seller is responsible to bring or ship all the tools, spare parts, manuals necessary to re-assemble the plant back to its original status. Seller will get the instructions in detail in a separate package, don’t ask for it now, we are not there yet. After assembly and production of the first samples of the end product, the seller gets the balance of the payment. Over the years we have worked our system to a precise formula which saves time, energy and money. “