Transitions From Start to Finish. The Business Life Cycle of Columbia Analytical Services

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Blanche Baker
5 years ago
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1 Transitions From Start to Finish The Business Life Cycle of Columbia Analytical Services

2 Beginning The idea of CAS began in 1976 CAS business plan was an MBA project Plan put on back shelf as my career at Weyerhaeuser developed In early 80 s, Weyerhaeuser R&D emphasized entrepreneurialism As head of the R&D analytical lab I proposed commercialization of services

3 The Test Weyerhaeuser Analytical Services launched using dusted off and revised CAS business plan Operated WAS for several years developing contacts and skills Quit with partner and launched CAS in Primary focus --inorganics with EPA CLP contract as a goal and vision to be the best analytical lab in the PNW

4 First Sale CAS grew rapidly Within 2 years needed money to expand more equipment, services and people Sold to EMCON to fuel capital expansion Wholly-owned subsidiary as EMCON went public and expanded nationally AS EMCON expanded geographically so did CAS

5 Buy Back CAS grew under EMCON from ~2M to ~12M in sales Difficult being part of engineering company Proposed repurchase of CAS from EMCON Bought company back using leveraged ESOP (Employee Stock Ownership Plan) mechanism in 1997

6 ESOP Years CAS culture fit ESOP Participatory management Encourage ideas and innovation Everyone s an owner, 80% ESOP Grew from ~12M to ~40M No environmental in CAS Created, developed and sold Dotser

7 Crystal Ball Too big to be small, too small to be big Markets flat in foreseeable future ESOP fiduciary responsibility increasing CAS was at a plateau Largest Maxwell List lab still independent Consolidation of market continuing Senior management getting old CAS Board decided to test the waters

8 Selling Process Selection of an investment bank Create a book Solicit interest Create a competitive auction Set a lower limit Review offers, select buyer Go through due diligence and final sale

9 The End Whole process took about 18 months Sale completed in October of 2011 Company sold for ~1 times sales CAS ESOP shares sold for ~ twice their appraised value, converting CAS stock to more liquid assets in the pension Most employees were retained

10 Post Mortem ESOP must maximize shareholder value CAS culturally different than new owner Some brain drain from company Most shareholders happy For 25 years CAS grew from infancy to maturity, developed an outstanding reputation, and delivered results to our customers and shareholders

11 Some Insights The value of ACIL Don t sell when you have to Your company is usually never worth as much as you think Hard to place value on intangibles Sell your real estate separately Engage a broker/investment bank Don t expect a buyer to operate your company the same way you did Prepare for the day after the sale

12 Life After CAS Trustee at the local college Established a non-profit, Laboratory Science Institute (new ACIL member) Focus on science awareness and STEM education and research Some consulting Otherwise: time you enjoy wasting is not wasted time

13 Buffett Jimmy not Warren yesterdays are over my shoulder, So I can t look back for too long. There s just too much to see waiting in front of me, and I know I just can t go wrong

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