Talawanda Turbines is a leading manufacturer of industrial fans, blowers and exhaust systems with a diverse customer base. It has experienced high organic growth through innovative processes and expanded into new markets through acquisitions. A sale to a strategic buyer is recommended to realize synergies and given the current M&A environment, with SPX Corporation identified as the best fit due to opportunities in similar verticals.

1. Talawanda Turbines
2022 William Blair Investment Banking Case Competition
Jake Askari | Christian Biscardo | Ben Elias | Nikki Yadavalli

2. Executive Summary
Industry Overview
Positioning Analysis
Valuation Analysis
Strategic Options
Final Thoughts
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4
17
22
11
7
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3. Potential Buyers
Valuation Field
Compelling Story Sell-Side Advisory
Strategic
Buyers
Financial
Sponsors
Executive Summary
Executive
Summary
Industry
Overview
Positioning
Analysis
Valuation
Analysis
Strategic
Options
Final
Thoughts
Appendix
Talawanda Turbines has cemented itself as a leading manufacturer of
industrial fans, blowers and critical exhaust systems supplying a
sticky, diverse customer base. Its innovative and efficient processes
has yielded high organic growth while an emphasis on M&A activity
has allowed them to expand into new markets and industries. Thanks
to an already-established model and promises for future innovation
and expansion, Talawanda is positioned for a bright, successful
future.
We recommend a sale to a strategic buyer considering the
opportunity to realize synergies (cost and revenue alike), along with
the current market environment. M&A and multiples are down due to
the current economic environment.
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4. Industry Overview
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5. Industry at a Glance
Market Pool
Analysis
Industry Overview
Executive
Summary
Positioning
Analysis
Valuation
Analysis
Strategic
Options
Final
Thoughts
Appendix
The industrial fan and blower industry is controlled by a number of
small players supplying regional manufacturing companies with
fans, blowers, and other similar machines. It is highly dependent on
the overall manufacturing industry, leading to major influences from
broader macroeconomic factors and a history of regional focuses
over large expansion and growth.
Select Competitors
Product Segmentation
14.1%
85.9%
Ametek, inc.
Other
Industry dominated by
small, regional firms
Focus on brand
establishment over growth
No overarching threat of
monopolization by large
powerhouses
Other
Industrial and commercial
fan and blower parts
Centrifugal fans and blowers
Power roof ventilators and parts
Air purification fans
and ventilators
1.5%
16.1%
26.6%
6.0%
49.8%
0.0% 10.0% 20.0% 30.0% 40.0% 50.0%
Industry
Overview
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6. Recent Developments
Key External Drivers
Industry Trends
Executive
Summary
Positioning
Analysis
Valuation
Analysis
Strategic
Options
Final
Thoughts
Appendix
Future Outlook
Revenue Growth
FY25P
FY24P
FY23P
FY22E
FY21
FY20
$5,400
$5,600
$5,800
$6,000
$6,200
$6,400
$6,400
$6,600
Revenue
($m)
The Inflation Reduction Act includes provisions to improve
infrastructure, which will benefit the overall manufacturing
sector and therefore the fans and blowers industry.
The COVID-19 pandemic has led to decreases in demand for
commercial space, affecting the need for industrial machinery
such as fans and blowers.
The value of nonresidential construction is projected to rise,
which will increase the demand for fans and blowers.
The desire for ESG will increase opportunities for the industry to
develop new technologies to coincide with these campaigns.
US exports are expected to increase, which would drive revenue
growth and allow for international expansion.
Value of private nonresidential construction
Value proportional to demand for industrial
machinery and goods
Manufacturing sector performance
Key supplier to manufacturing companies and
therefore rely on the industry's success
International trade
Cheap manufacturing countries, such as China,
affect the demand for US fans and blowers
Industry
Overview
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7. Positioning Analysis
7

8. Talawanda Turbines at a Glance
Potential Acquisitions
Domestic
European
Further M&A activity would expand Talawanda into new industries and
markets while not interfering with their current business model or solid
customer base.
Company Overview
Executive
Summary
Positioning
Analysis
Industry
Overview
Products and Customers
Valuation
Analysis
Strategic
Options
Final
Thoughts
Appendix
Centrifugal
Blowers & Fans
Market-leading designer and manufacturer of industrial fans,
blowers and other similar machinery
Unparalleled engineering of custom options with new, innovative
designs consistently being developed
Diverse and committed customer base ranging across numerous
high-growth industries
High
Temperature
Fans
Critical Exhaust
Systems
Replacement
Parts
Dust Collectors /
Portable Fume
Exhausters
Axial Fans
10% 18%
19%
23%
3%
8%
19%
Food & Beverage
Medical & Healthcare
Laboratory Research Exhaust
Other Applications
Filtration & Air Control
General Industry
Material Handling
Customer Segments
by Revenue
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9. Market Opportunities
Competitive Advantages
Growth Positioning
Executive
Summary
Positioning
Analysis
Valuation
Analysis
Strategic
Options
Final
Thoughts
Appendix
Industry
Overview
Net Revenue Growth
Future Strategic Initiatives
FY24P
FY23P
FY22E
FY21
FY20
$200
$250
$300
$350
$400
$450
Net
Revenue
($m)
8.2% CAGR
Increased need for industrial goods with new investments in
infrastructure with the Inflation Reduction Act's passing
Spikes in demand for innovative ventilation and air filtration
systems due to health fears as a result of the COVID-19 pandemic
Patterns of companies relocating their manufacturing plants back
to the US and therefore demanding industrial fans
Increase investments in R&D in order to continue consistent
development of new, innovative systems and machinery
Expand into new European markets by leveraging the influence
gained from the 2015 acquisition of Brick Fans in the UK
Continue record of M&A activity both internationally for global
expansion and domestically for new industry penetration
Industry-leading delivery times stemming from a streamlined,
well-managed supply chain system
Diverse and fluid custom product line suitable of any industrial
or commercial need
Efficient manufacturing and engineering processes used to
develop new and better products consistently
High customer stickiness due to great customer relations and
reliance on custom parts
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10. SWOT Analysis
Executive
Summary
Positioning
Analysis
Valuation
Analysis
Strategic
Options
Final
Thoughts
Appendix
S W
O T
Industry
Overview
Diverse and customizable product pool
Sticky and devoted client base
Innovative and efficient R&D processes
New demand for manufactured goods
from the Inflation Reduction Act
Relocation of manufacturing plants
back to the US
Rising values of nonresidential construction
Relatively low gross margins
Only 3 current production plants in 2 countries
High reliance on overall
manufacturing industry performance
Decreased demand for commercial space
Increasing import competition
Low industry barriers of entry leading to
increased competitiom
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11. Valuation Analysis
11

12. Valuation Overview
Executive
Summary
Positioning
Analysis
Valuation
Analysis
Strategic
Options
Final
Thoughts
Appendix
Industry
Overview
12

13. Comparable Companies
Executive
Summary
Positioning
Analysis
Valuation
Analysis
Strategic
Options
Final
Thoughts
Appendix
Industry
Overview
13

14. Precedent Transactions
Executive
Summary
Positioning
Analysis
Valuation
Analysis
Strategic
Options
Final
Thoughts
Appendix
Industry
Overview
14

15. Discounted Cash Flow
Executive
Summary
Positioning
Analysis
Valuation
Analysis
Strategic
Options
Final
Thoughts
Appendix
Industry
Overview
Implied Valuation
Commentary
A much higher valuation is observed under the Exit
Multiple Method due to a conservative approach
regarding revenue growth
Beta derived from comparable average of unlevered betas
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16. Leveraged Buyout (LBO)
Executive
Summary
Positioning
Analysis
Valuation
Analysis
Strategic
Options
Final
Thoughts
Appendix
Industry
Overview
16

17. Strategic Options
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18. Potential Acquisition
Executive
Summary
Industry
Trends
Positioning
Analysis
Valuation
Analysis
Strategic
Options
Final
Thoughts
Appendix
Option 1: To remain domestic
and increase preexisting
recognition in the United States
Option 2: To enter a new
market by being acquired by an
international company with
resources available to expand
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19. Strategic Buyers
Executive
Summary
Positioning
Analysis
Valuation
Analysis
Strategic
Options
Final
Thoughts
Appendix
Industry
Overview
Description Metric Rationale
North American
Manufacturer of pump and
dispensing equipments and
other engineered products Revenue LTM: $2.26 Bn
North American Supplier
of engineered
infrastructure equipment
and technologies Revenue LTM: $1.5 Bn
Idex is based in Northern Illinois which
creates the same Midwestern environment
that Talawanda Turbines is currently in. This
will make growing brand recognition easier
and allow for more synergies
SPX corporation deals with air conditioning
and ventilation. These verticals offer similar
objectives to Talawanda Turbines.
Swedish supplier focused
on products and solutions
for heavy industry Revenue LTM: $4.77 Bn
Alfa Laval is a global leading supplier of
industrial products and solutions. Along with
name recognition, Talawanda Turbines will
be able to enter new markets and expand on
an international level
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20. Executive
Summary
Positioning
Analysis
Valuation
Analysis
Strategic
Options
Final
Thoughts
Appendix
Industry
Overview
Rationale
Criteria
Prioritizes infrastructure
investments with limited
downside risk
Strives to invest in deals with
capabilities of 750+ million
Broad capabilities and invests
heavily in Industrial sector
KKR is a leading private equity firm with a diverse portfolio
Has the experience and name recognition to grow Talawanda
Turbines
Has various deal experience with Industrials and can use this to
assist the firm in achieving financial success
Leading Private Equity firm with multiple resources and experience
in the Industrials and Manufacturing sector
Has the required expertise and finances to assist Talawanda
Turbines and use TCG's brand to help reach significant growth
Worked with William Blair and has acquired a diverse range of
companies
Can add Talawanda Turbines to their industrial portfolio and
focus more attention on growing the company due to the smaller
size of their firm compared to other PE shops with more deal flow
Invests globally with locations
in New York and Hong Kong
Has a variety of deals across
different verticals
Financial Sponsors
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21. Best-Fit Buyers
Executive
Summary
Positioning
Analysis
Valuation
Analysis
Strategic
Options
Final
Thoughts
Appendix
Industry
Overview
Talawanda Turbines operates in a niche industry that several other potential acquirers
did not directly deal with. SPX corporation works with similar verticals and therefore,
will have the greatest chance of achieving significant synergies. We realize that a
strategic buyer would be the best-case in helping expand Talawanda Turbines' platform
and help with the business operations.
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22. Final Thoughts
22

23. Final Thoughts
Executive
Summary
Positioning
Analysis
Valuation
Analysis
Strategic
Options
Final
Thoughts
Appendix
Industry
Overview
Strategic buyers are often willing to pay highly for an acquisition, and
they enable Talawanda Turbines to completely walk away, while
getting the most liquid value. They also use industry experience to
close quicker, and can create operational strategies to boost
efficiency.
Talawanda Turbines operates in a niche industry that several other
potential acquirers did not directly deal with. SPX corporation works
with similar verticals and therefore, will have the greatest chance of
achieving significant synergies. We realize that a strategic buyer
would be the best-case in helping expand Talawanda Turbines'
platform and help with the business operations.
Best Fit Acquisition Scenario
Final Recommendation
Valuation Overview
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