Equity Firm Shops

GRAND RAPIDS — TMB Industries has been cruising West Michigan with checkbook in hand. The Chicago-based equity firm has recently exited the venture that brought it to this area, and is looking for its next big acquisition. But surprisingly, considering the negative perception of the region’s manufacturing base, the store is short on big-ticket items.

But there are some deals on the shelf, though they are on the smaller side.

In a transaction involving its second-smallest company ever, TMB acquired Miller Products, a 57-year-old automotive supplier with primary manufacturing facilities off of

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As an under-performing automotive company, Miller Products matches turnaround specialist TMB’s general acquisition criteria. The $10 million coater and painter currently supplies OEMs such as General Motors, DaimlerChrysler and Ford Motor Co., among others. GM recognizes Miller Products as a Green Light-certified supplier, a distinction that represents environmental excellence.

Improving the company’s performance means a hefty initial investment by TMB.

“The key thing is putting a lot of capital upfront,” said Tim Masek, West Michigan‘s TMB partner. “There is going to be quite a bit of money spent here in the next couple months.”

Masek indicated that those capital investments are earmarked for general housekeeping, environmental improvements, new equipment, information technology, and quality systems.

According to Masek, another key component to the 100-day takeover plan is diversification of the firm’s clientele.

“We’re looking at applications outside of the automotive industry to balance out our customer base,” he said. “Seating and office furniture are good areas for us.”

TMB also acquired Miller’s real estate. Historically, it has purchased only the company itself, allowing a real estate group to acquire the facility, and then lease it back. The new procedure signifies a commitment to the region and company, Masek said, as closing the facility becomes much less convenient.

“Our plan is to make a true commitment,” he said.

In the long term, TMB hopes to grow not only Miller Products’ customer list, but also its number of employees, customers and the strength of its bottom line.

Masek said the company is currently investigating as many as five other local offerings, all in the same size range as Miller Products.

“Our investment criteria is flexible,” said Masek. “You’ve got to look for the opportunity versus the size of the transaction. I think it’s clear there aren’t a lot of real large transactions out there, and if there are any, I’d like to know about them.”

TMB recently sold Fuel Systems LLC, a Grand Rapids manufacturer of steel fuel tanks, to Brazo Limited Equity Partners LLC. Michael Stevens, a TMB executive, has been appointed the new president of the 100-employee firm. Previous owner and president John DiMaria remains with the company in a sales and advisory capacity.