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Gammill, Inc. Sale to Champlain Capital Management, LLC

Gammill Quilting SystemsGammill Inc. designs, assembles, and markets high-end quilting machines, known as ‘longarm’ quilting machines, to quilting enthusiasts and entrepreneurs. After developing and introducing the first longarm quilting machine and spending 20 years building the business the founder, Ken Gammill, at age 74, was ready to retire. With no partners or management succession plan in place, Mr. Gammill knew he needed help to realize the value.

The Fortune Group saw a couple of significant challenges in this transaction. The longarm quilting machine market was a small market niche and most potential buyers were unfamiliar with this unique consumer product. Second, Mr. Gammill had grown the Company by devoting his time to product development and sales and marketing. Considerably less attention had been given to financial management, industry intelligence and dealer relationships.

After evaluating the situation, The Fortune Group devised and helped implement a plan to address areas of strategic importance and increase the value of the Company to a prospective buyer. Drawing upon the resources of its principals and its extensive network of other contacts, The Fortune Group assisted the Company by:

  • Identifying and arranging for the hiring of a Chief Financial Officer which allowed the Company to begin producing timely, accurate financial statements;
  • Designing a dealer survey program that provided valuable information the Company could use to design new product offerings and forecast future sales;
  • Developing market information about the size and growth prospects for longarm quilting machines that was used in discussions with prospective buyers; and
  • Solidifying long-term relationships with key vendors to avoid any disruption of supply during the sale transaction.

With the implementation of the plan, The Fortune Group resumed its marketing activities and conducted a controlled auction that that generated 18 written proposals to buy the company from qualified buyers. After holding meetings with a small number of these prospective buyers, Mr. Gammill sold the Company in an all cash transaction to Champlain Capital LLC for an amount that exceeded his initial sales price expectations by more than 50%!