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ADCO Global, Inc. Corporate Divestiture

ADCO Global, Inc. Corporate DivestitureThe Fortune Group was retained by ADCO Global, Inc., a portfolio company of Aurora Capital Group, when it determined that its Plastic Sheet and Profile Extrusion Division was not compatible with its core competency, specialty adhesives. Management intended to implement an aggressive plan for acquisition growth to expand its core business while divesting the Plastics Division.

The Plastics division of ADCO Global consisted of one plant operating in Evansville, Indiana and, although respected in the industry, was not large enough to match the operating and financial resources of two relatively large national companies it competed with. As a stand-alone operation, the operating results were not sufficient to justify a valuation as a going concern larger than the current book value of the division.

The Fortune Group selectively marketed the Plastics Division to only a few national companies considered by management and The Fortune Group to have enough synergies with the operation to maximize the value to ADCO Global, Inc.

This Plastics Division was ultimately divested in two separate transactions: (1) Spartech Corporation, the largest custom plastic sheet manufacturer in North America, acquired the Plastics Division working capital and some of the equipment for relocation to one of the existing operations, and (2) the real estate was sold virtually simultaneously to an unrelated third party.