Hagan: Study Shows Fastener Company Acquisition Prices Down
Hagan: Study Shows Fastener Company Acquisition Prices Down
John Wolz
What is a fastener distributorship worth today? After analyzing 13 fastener company acquisitions for a Valuation Book, Richard Hagan of Pinnacle Capital Corporation pegged the value in today�s market at 4.5 to 6.5 times EBITDA.
The 13 fastener companies� acquisitions from 1998 to 2002 ranged from 4.7 times EBITDA to 11.7 multiples and averaged 6.9 times.
Because of the slow market of the past few years Hagan observed that �there are a lot of bottom fishers� looking to buy based on 2001 and 2002 results rather than an entire business cycle.
Both the number of fastener acquisitions and purchase price multiples have steadily declined since the peak in 1999, Hagan pointed out. �For example, it can be argued that M&M Aerospace Hardware Inc. is at least as attractive as either Standard Parts & Equipment Corp. or TriStar Aerospace Company,� Hagan explained. �However, M&M Aerospace sold for 6.5 times trailing EBITDA in late 2001, while Standard Parts and TriStar sold for 7.8 and 8.4 times during 1999. E-mail: rphagan@pinnaclecapitalcorp.com �2003 FastenerNews.com
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