Mid-American deal boosts firm's capabilities
LeROY, Kan.—It has been an active couple of months for Mid-American Machine & Equipment Inc.
Recently, the company expanded its spare parts business and fabrication services when its parent, Industrial Service Solutions, acquired Madison-Smith Machine & Tool Co. of Glasgow, Ky. The purchase will help the supplier better serve tire and rubber customers in the eastern U.S., while expanding its manufacturing capabilities "immensely" without an unmanageable capital investment, said Mid-American Machine President Shane Sutherland.
Mid-American Machine, founded in 1997, now provides machinery reconditioning, repair, installation and equipment rigging services as well as new and used machinery and equipment from facilities in LeRoy, Glasgow and Sylacauga, Ala.
In April, Mid-American Machine expanded its sales and service capabilities to the global tire and rubber industries by launching a product inventory section to its website, www.mid-americanmachine.com.
The company continues to be in a slow and steady growth mode, Sutherland said, with Mid-American Machine revenues expected to rise 5-10 percent this year. The supplier's annual sales have grown consistently, an average of 2-5 percent during the last 15 years, he added.
"In the past we have been more of a used and rebuilding equipment company, which has served us well," he said. "But with some of our recent strategic moves, we are positioning ourselves to provide equipment directly to the OEMs. That's the next step in our growth phase, and we realize it is a significant one for the company. That next step on the OEM side will put us on a different level."
Financial terms of the acquisition of Madison-Smith were not available immediately. It is expected that all of the roughly 70 employees of Madison-Smith will remain with the new parent company, and operations will continue at the Glasgow plant.
Madison-Smith will continue to operate under its existing brand but will be brought into the Mid-American Machine name gradually over the coming months, Suth¬- erland said.
Good fit for Mid-American Machine
Madison-Smith, with 100,000 square feet of production and warehouse space, serves the food, mining, metals, automotive and other manufacturing industries. The operation will begin making and stocking Mid-American Machine's spare parts.
Mid-American Machine always is interested in possible mergers and acquisitions that make strategic sense, and the Madison-Smith deal fit from a financial and operational perspective, Sutherland said.
"We were looking to locate a capable shop that had great people and client connections that ISS as a parent company could utilize and build on," he said. "Both companies are in a growth mode and very healthy. They have a strong customer base that we feel will only add to our capabilities."
Mid-American Machine and ISS have an extensive field service group located around the U.S. that will be able to partner with Madison-Smith's existing client base, Sutherland said.
"What impressed us about Madison-Smith was its full range of capabilities and equipment that they've used to help customers reconfigure production lines for new products," Sutherland said. "It will help us provide replacement parts and fabricated material in an efficient manner so our clients can get their production ramped up."
The added warehouse space in Kentucky also will allow Mid-American Machine to carry a larger inventory of spare parts onsite for its customers.
The new product pages established in April have enabled Mid-American Machine's customers worldwide to access information easily about its extensive inventory of new and used tire and rubber equipment.
The company launched its new product inventory catalog in April with an initial offering of more than 100 pieces of equipment, and it plans to add more machinery to the website throughout the summer.
"Spare parts business growth is a key focus for Mid-American, and by acquiring an operation like Madison-Smith so near our customer base, we're better positioned to expand our parts offerings," Sutherland said. "Even as we reach out more to work directly with OEMs, we are going to retain our long-term customer base and ensure that they are serviced."