Allstates Rigging Inc, located in Two Rivers, WI, is a trusted heavy machinery moving company established in 1992. With more than 150 years of machinery moving experience, they offer safe, quality service by highly skilled operators while maintaining exceptional customer service. Allstates’ many services include plant relocation, machinery transportation, forklift service, millwright and maintenance, and shrink-wrap and palletizing.
In 2017, Sam Grage was named president and became sole owner of Allstates Rigging. Additionally, through ongoing dialogue with the former owners of KNM Machining and Industrial Maintenance, the opportunity arose for Grage to acquire their company as a complementary business to Allstates Rigging.
At first, the KNM acquisition process moved slowly. With negotiations stalling among the various parties involved, and with the end of the due diligence timeline approaching, Investors Community Bank was sought out to assist in financing the acquisition. ICB stepped in to assist Grage in understanding the SBA process, while also working with the seller, attorneys, and other third parties. To make this expansion and acquisition successful, ICB utilized two Small Business Administration (SBA) loan programs. The SBA XP program was used to provide working capital in the form of an increased line of credit. The SBA 7(a) program was used to purchase the assets and finance the goodwill of KNM. Through the use of these programs, ICB was able to help Grage close the deal in early 2019.
As a result of the historic success in using the SBA programs, Investors Community Bank recently assisted Allstates Rigging once again with use of the SBA 7(a) program to add new equipment to help maintain their competitive position in the marketplace. This growth, in addition to the purchase of KNM, has allowed the group of companies to maintain a competitive edge and a one-stop-shop for its customer base, which spans the entire United States.
Using these SBA programs allowed for long-term repayment flexibility versus what traditional financing would offer on acquisition and equipment term debt. Often, acquisition financing is under-secured and there is a large portion of goodwill in the purchase. This would require a fast amortization. Through the SBA program, ICB was able to offer the customer a blended maturity loan on the acquisition that would allow more cash flow flexibility, ensuring a chance at viability and allowing funds to be reinvested in the company for growth versus applying all cash flow to a larger note payment. Additionally, ICB was able to offer long-term fixed rates to the borrowers on their term notes with use of a secondary market program.
The result of the SBA financing was the creation of a diversified, yet complementary business. ICB was able to guide the borrower and involved parties through the entire acquisition and borrowing process.