The Transfer Portal

We are in a unique time, when smalland medium-sized companies are in the trenches competing to win talent, as we have never seen before. During the past 24 months, we have witnessed a multiplier expansion in the number of third-party groups providing all types of support to business owners.

In many cases, these third-party providers are convincing the owner to work with them for two to four years to “prepare” the business for sale.

What happens if the owner needs to sell the business now? Enter your investment banker and team from the transfer portal.

The management team at most firms will work very well with the M&A team once they begin their due diligence. In most cases, the M&A team will make one visit to the firm’s facility and then complete most of their work remotely during the next nine to 12 months. Maintaining a low profile is ideal for the M&A team and reduces stress among the business owner’s employees.

If a firm has engaged a third-party group to help them prepare, then tension may exist when the M&A team walks in the door and their client attempts to move into the next phase of their multiyear plan – selling the business. How would your third-party team feel when your nearly two years of work is but a futile effort?

The M&A Team has their standard due diligence lists and the management team should easily produce materials to satisfy the specific section. Let’s use sales and marketing as an example.

Due diligence request for sales and marketing:

1. Marketing and sales literature and forms, including price lists, catalogs, purchase orders, technical manuals and user manuals.

2. Marketing agreements and material agency and advertising contracts.

3. All agreements or proposed agreements with distributors, dealers and sales representatives.

4. List of any warranty claims, and reserves and expenses related thereto.

5. Listing and description of all co-branding, private label, alliance, joint venture, partnerships, co-marketing, distribution, licensing, or similar agreements with other entities use by the companies.

6. Copies of all side letters and oral agreements.

7. List and general description of commission or other compensation arrangements with sales personnel.

8. E-commerce statistics and SEO results.

9. Client’s five- or 10-year transaction history and profit analysis.

In some instances, the third-party provider is filling a role that the owner has had trouble hiring for within the management team. My previous example focused on the sales and marketing due diligence efforts – maybe the third-party individual is temporarily fulfilling that role for the management team. Once the M&A team is in place, perhaps the next logical step would be for the owner to offer a full-time job to the third-party provider. In essence, that third-party individual or team has just moved into their own transfer portal.

The M&A team should embrace and collaborate with all members of the management team regardless as to whether they are full time staff or a third-party service provider.

Indicators on Coincident Indexes

Federal Reserve Bank of Philadelphia, Third District Coincident indexes, March 2023 (See table page 46):

Pennsylvania

In the three months to March, the coincident index for Pennsylvania rose 1.1 percent. The level of payroll employment increased over the past three months. The unemployment rate decreased during the three-month period. In addition, average hours worked in manufacturing increased. Overall, Pennsylvania’s economic activity as measured by the coincident index has risen 3.4 percent over the past 12 months.

New Jersey

In the three months to March, the coincident index for New Jersey increased

0.1 percent. The level of payroll employment increased over the past three months, and average hours worked in manufacturing increased. However, the unemployment rate increased during the three-month period. Overall, New Jersey’s economic activity as measured by the coincident index has risen 3.2 percent over the past 12 months.

Delaware

In the three months to March, the coincident index for Delaware rose 1.4 percent. The level of payroll employment rose over the past three months. The unemployment rate decreased during the threemonth period but generally remained higher than its pre-pandemic level. Additionally, average hours worked in manufacturing increased. Overall, Delaware’s economic activity as measured by the co- incident index has risen 2.6 percent over the past 12 months.

Good luck closing your transaction!

This article has been prepared solely for informational purpose. This article does not constitute an offer, or the solicitation of an offer, to buy or sell any securities or other financial product, to participate in any transaction or to provide any investment banking or other services, and should not be deemed to be a commitment or undertaking of any kind on the part of Wiley Bros. –Aintree Capital, LLC (“WBAC”) or any of its affiliates to underwrite, place or purchase securities or to provide any debt or equity financing or to participate in any transaction, or a recommendation to buy or sell any securities, to make any investment or to participate in any transaction or trading strategy. Any views presented in this article are solely those of the author and do not necessarily represent those of WBAC. While the information contained in this commentary is believed to be reliable, no representation or warranty, whether expressed or implied, is made by WBAC, and no liability or responsibility is accepted by WBAC or its affiliates as to the accuracy of the article. Prior to making any investment or participating in any transaction, you should consult, to the extent necessary, your own independent legal, tax, accounting, and other professional advisors to ensure that any transaction or investment is suitable for you in the light of your financial capacity and objectives. This article has not been prepared with a view toward public disclosure under applicable securities laws or otherwise.

Ocean State Innovators Acquires Cloud9 Fabrics

Ocean State Innovations, a leading textile provider, announced the acquisition of Cloud9 Fabrics of Cranford, New Jersey. Cloud9 Fabrics predominately offers organic fabrics to the quilting trade. Ocean State Innovations was formerly known as Brand and Oppenheimer and acquired another quilting fabric company, General Fabrics, in 2018. Cloud9 has been in business for over 14 years and also offers a selection of apparel fabrics for home sewing. They use only 100% certified organic cotton in the manufacturing of their cotton base cloths and eco-responsible low impact dyes for printing and dying.

www.osinnovate.com

Sales

ADVERTISING | SALES

PUBLISHER Driven By Design LLC advertising@inda.media • +1 239.225.6137

Sabine Dussey

GERMANY, FRANCE, AUSTRIA, SWITZERLAND, SCANDANAVIA, BENELUX sabine.dussey@dussey.de • +49 2129.348390

Joan Oakley BUYER’S GUIDE & CLASSIFIED ADS joakley@inda.media • +1 248.347.3486

Ferruccio Silvera & Filippo Silvera ITALY & SPAIN info@silvera.it • +39 02.284.6716

Frank Strazzulla UNITED STATES +1 949.459.1767 • franks@tmsmedia.net

Zhang Xiaohua CHINA ifj_china@126.com • +86 13522898423

ADVERTISING COORDINATOR VICKIE SMEAD vsmead@inda.org • +1 919 459 3700 x 3720

Lenzing Offers Locally Produced TENCEL™ Fibers to Chinese Customers

he Lenzing Group, a world-leading provider of specialty fibers for the textile and nonwoven industries, has successfully completed the conversion of a production line from generic viscose to TENCEL™ branded modal fibers for textiles and clothing at its facility in Nanjing, China. Lenzing is therefore in a position to offer its Chinese customers locally produced TENCEL™ fibers for the first time and meet the structural growth in demand more quickly. Thanks to the conversion of the production line with a nameplate capacity of 35,000 tonnes per year, the fiber portfolio of the Chinese production site now solely consists of eco-friendly specialty fibers. In addition, www.lenzing.com

Lenzing also offers LENZING™ ECOVERO™ branded fibers for textile applications and viscose eco fibers for nonwoven applications in China.

Celebrations for the launch of the new production line took place in April 2023, as part of a customer event.

Apex Mills Appoints Joan Izzo as Senior Marketing Manager

pex Mills, a fully integrated domestic supplier and manufacturer of custom technical and specialty textiles and fabrics, has named Joan Izzo as new Senior Marketing Manager. She will build greater awareness of the company brand as an innovative supplier and fabricator as well as promote newly expanded capabilities. She brings 25 years of experience with global manufacturers of fibers, fabrics, elastomeric films, and engineered materials across a wide variety of industries.

Most recently, she was Marketing Director at INDA, the Association of the Nonwovens Industry.

Izzo has strong expertise in the For -

Advertiser Index

tune 500 B2B arena, marketing to diverse sectors including apparel, automotive, consumer products, healthcare, filtration and furnishings.

Apex Mills’ recent acquisition of the former Hanesbrands Inc. facility in Woolwine, VA offers new opportunities for its customers, “With her excellent experience, Joan will increase awareness of Apex Mills by marketing our innovative solutions for customers seeking high quality, made in USA products,” said Jonathan Kurz, Apex Mills President and Chief Executive Officer. “She will play a critical role in developing and supporting growth strategies.” www.apexmills.com

Industry-Changing

Discover everything happening in the nonwovens and engineered fabrics industry. Visit inda.org and join the momentum.

World of Wipes® (WOW)

Upcoming Events

FiltXPO™ | International Filtration/Separation

International Conference Exhibition & Technical Conference

July 17-20, 2023

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October 10-12, 2023

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HYGIENIX™ | The Premier Event for Absorbent Science for Engineered Fabrics) Hygiene & Personal Care Markets

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September 26-27, 2023

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November 13-16, 2023

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Upcoming Training

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June 20-23, 2023

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September 12-14, 2023

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WIPES Academy

July 17-18, 2023

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Intermediate Nonwovens Training Course

August 1-4, 2023

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Filter Media Training Course

October 9-10, 2023

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Intermediate Nonwovens Training Course

October 24-27, 2023

INDA Headquarters, Cary, NC & The Nonwovens Institute, & The Nonwovens Institute, NC State University - Raleigh, NC NC State University - Raleigh, NC

INDA Headquarters, Cary, NC

Absorbent Hygiene Training Course

August 8-10, 2023

INDA Headquarters - Cary, NC

Elementary Nonwovens Training Course

August 22-23, 2023

INDA Headquarters - Cary, NC

Fabric Property Development & Characterization

December 5-8, 2023

The Nonwovens Institute, NC State University - Raleigh, NC

For more information visit inda.org