Background:
The Ascension Team Represents MiddleGround Capital, the private equity owner of Lindsay Precast. Lindsay Precast is a designer and manufacturer of engineered precast concrete structures for water, utility, solar, transportation, and government end-markets. The company had recently acquired Dutchland Inc. as an add-on to the broader platform. Dutchland is an industry expert in designing and building precast concrete tanks and treatment plants for water and wastewater retention and treatment. Dutchland is based in Gap, Pennsylvania, operating out of a 37-acre manufacturing and outdoor storage site.
Client Objective:
Having worked with the Ascension team on a number of sale leasebacks, MiddleGround approached the team about a sale leaseback of Dutchland's strategic location in Gap, Pennsylvania. The site spans over 145,000 square feet and nearly 37 acres, and a sale leaseback of this property would serve as an ideal way for the company to free up capital to reinvest into the business and facilitate additional growth for the operating company.
Solution:
With Ascension’s strong track record in the manufacturing and outdoor storage sectors, the team ran a competitive off-market process seeking a cash buyer who could close in the quick timeframe desired by the sponsor. After multiple rounds of bidding, the team closed the transaction with a public REIT focused on manufacturing facilities, who was also familiar with the broader Lindsay Precast platform. The transaction closed at favorable terms to all parties, and the buyer also committed to fund future expansions for the business.
Ultimately, the sale leaseback proceeds were used to finance major CapEx items and buying new equipment - including a production line to the facility - all activities that contribute to the core operating business. While increasing capacity at the facility, the company was able to drive enhanced profitability versus having capital tied up in a non-appreciating building asset.
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