Canada has a proud history of manufacturing quality and success, but, as many companies find out, the industry is facing more challenges today than ever. Globalization, for one, has increased international competition, introduced new production technologies, put downward pressure on Canadian prices and heightened exchange rate volatility. At the same time, traditional Canadian businesses have been reluctantly tempted to move their manufacturing offshore with the promise of low foreign wages and input costs.
Lipson Shirtmakers has been a proudly Canadian, family-owned company that has been making high quality dress shirts for three generations from its Toronto factory since 1958. Recently, the company was challenged by the competitive pressures facing a small business firm in the new market landscape. This led the family to consider alternatives for transitioning the business, including the possibility of a strategic partnership with a larger firm in the industry.
Lipson decided to contact the M&A team at Farber to leverage their deep experience. Once Farber came into the picture, the company was able to explore the full array of options available to it, including refinancing the business, re-mortgaging real estate and sale of the business.
After an in-depth consultation and needs assessment, the Lipson family decided to pursue a sale to a strategic party, with Farber as its advisor. The Farber M&A team conducted a full market search, identified and qualified strategic buyers, marshalled due diligence materials, assisted in negotiating with buyers and financiers, and managed the process to a successful closing.
As with most divestitures, the overall deal had its challenges. However, we tailored the solution to the unique situation—maximizing value on the sale and ensuring the family objectives were met. These included preserving the legacy of the Lipson name, ensuring a smooth ownership transition and creating a new role for family management in the combined entity.
The Lipson family always had the highest standard for its products and its company. By working with Farber to assure its tradition into trusted, capable hands, that tradition has remained intact.
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Glenn Bowman is a Senior Managing Director and leader of the Corporate Finance & Valuations practice of Farber. His practice focuses on advising clients on acquisitions and divestitures. Glenn can be reached at 416.496.3192 and firstname.lastname@example.org.