Business Summary:
The company specializes in customized chemical treatment solutions for the oil and gas industry and water treatment sectors. The company enjoys an envious business model with extremely high margins, repeat business, third-party outsourced manufacturing, nocapex, and extremely low overhead. It distinguishes itself through its proprietary products, acclaimed for their best-in-class performance, particularly in scale control and corrosion inhibition.The company has emerged as a trusted partner in navigating challenges associated with scale control in industrial settings.Focusing on delivering substantial cost savings, minimizing downtime, and enhancing operational efficiency, the company serves as a strategic ally for oilfield chemical service companies and energy companies alike.High Margin: Current EBITDA margin as a percentage of sales is 47.5%.Overhead is less than 3% of sales.High Growth: Revenue and Margin more than doubled in 2022 vs 2021. And 2023 was approximately 70% higher than 2022. There has been overall product growth in customer applications for Frac/Stimulation (scale inhibitor) and corrosion inhibitor for production treating. Currently there are several “new projects” in various stages of development.Scalable: All products are blended at designated 3rd party “toll blending” facilities on a made to order basis. All Raw Material inventory is maintained at these locations. The company has no Capex and scaling only requires placing more orders with the 3rd party blending facilities.No risk assimilation and integration of the business: The business has an extremely simple business model. The entire business is currently run by the owner with bookkeeping assistance from his wife. There are no employees or facilities to assume, and the acquiring company will only need to integrate the customers and suppliers.Proprietary products with best-in-class-performance: The company has developed numerous unique and proprietary products that have achieved “best in class” performance in oil and gas applications. The formulations use several raw material components that are relatively unique to the company to achieve properties, functionality, and performance that are unrivalled among competitors. These applications include scale control (such as silica and severe barium sulphate), squeeze treatments, iron sulphide control and dissolution, and corrosion control.For the right acquisition partner, this opportunity could enable you to add these products to your business offerings and scale the business manytimes larger than the current owner has taken it. The owner is open to various transaction structures and transition periods and would be willing toremain with the acquiring company as a strategic advisor or partner to scale the business with the new ownership.
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