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Hunt Valve

Overview

Hunt Valve is a case where May River leveraged its knowledge of a specific industrial vertical and partnered with an experienced executive to create value.

Hunt Valve is a long-standing manufacturer of mission critical valves and actuators used in the Navy’s highest-priority submarines, aircraft carriers, surface combatant vessels, and other platforms.  The company has facilities in Montreal and Ohio, which manufacture proprietary valve and actuator technologies for prime shipbuilders and the U.S. and Canadian Navies.

At the time of the acquisition in late 2015, the U.S. Navy was preparing for what is still expected to be nearly a two-decade-long ramp up in new submarine and combatant ship production.  These new submarines will replace the aging Cold War-era fleet that will be forced into decommissioning over the coming years.  As one of only a handful of qualified providers of critical valves to the submarine and aircraft carrier programs, Hunt stood to benefit significantly from the upcoming new ship procurement cycle, as well as the consistent repair and replacement activity surrounding the existing active fleet.

Deal + Operating Thesis

The U.S. Navy’s supply chain is fragmented and comprised of many small, founder/family/entrepreneur-owned companies, a fact the Navy has publicly voiced concerns about as it pertains to the supply chain’s ability to keep pace with the upcoming build cycle.  The Navy’s significant future demand and supply-chain concerns placed Hunt in an excellent position to execute a buy and build strategy oriented around acquiring smaller, less well-capitalized suppliers.

Executive Resource Group (ERG) member, Brad Sterner, became the CEO of Hunt Valve in 2015 simultaneous to the closing of the original transaction.  Brad has significant experience in the flow control sector with several well-respected, publicly traded companies, and added immediate value to the platform. A key element of the Hunt Valve thesis was to support Brad in his development of a more fulsome management team that could lead the company over the next decade and beyond, which is now complete. Each of Hunt’s existing senior leaders, comprising Charles Ferrer (CEO), Peter Bellin (CFO), Mike Johnston (VP, Ops & Supply Chain), and Andy Pfister (VP, Engineering & Business Development), bring decades of experience from academy industrial firms, and have led Hunt through three successful acquisitions, more than quadrupling revenue and EBITDA since 2015.

Partnership + Results

SIGNIFICANTLY TOP-GRADED LEADERSHIP

May River introduced Brad Sterner as CEO at closing of the initial transaction, and subsequently recruited a successor CEO, new CFO, and new VPs of Ops & Supply Chain and Engineering & Business Development.

NAVY SUPPLY CHAIN CONSOLIDATION

Hunt Valve is an established, go-to U.S. Navy supply chain partner.  The acquisition and integration of three companies:  Precision Technologies; Montreal Bronze; and Pima Valve has significantly improved Hunt Valve’s product breadth, diversification of critical Navy programs, and after-market revenue from new ship builds and the existing active fleet.

DRAMATICALLY SCALED PLATFORM

Within five years, Hunt has more than tripled quadrupled revenue and EBITDA by improving business processes and systems, financial controls, supply chain management, and its go-to-market strategy.  Hunt has also top-graded the senior leadership team and has added breadth and depth to its products and Navy programs served.