Accubuilt, Inc. - Diversification in 2002

Diversification in 2002

During the first years of the 21st century, Accubuilt's expansion efforts continued, creating a larger, more diversified specialized vehicle manufacturer. In 2002, the company added another brand to its portfolio in order to explore other avenues of growth to complement its stalwart market position in the funeral coach business. "We've got 65 to 75 percent of that market," Accubuilt's chief executive officer, Stephen Griffith, explained in a November 6, 2002 interview with the Blade, a Toledo, Ohio, newspaper. "It's a fine market," Griffith continued, "but there isn't a lot of growth. If you want to grow you have to look at other opportunities. And mobility products are generally a better-growing market than funeral vehicles." Griffith's statement referred to Accubuilt's August 2002 purchase of Vartanian Industries, Inc., a Brodheadsville, Pennsylvania-based manufacturer of wheelchair, shuttle, and limousine vans. "It's a small acquisition," Griffith said at the time of the purchase in an August 12, 2002 interview with Knight Ridder/Tribune Business Times, "but it brings with it significant growth potential." Vartanian's Brodheadsville plant was closed after the acquisition, unable to accommodate new business, and moved to Lima, adding another dimension to Accubuilt's manufacturing activities.

As Accubuilt plotted its future course, further acquisitions were expected, with strong indications of an expansion-minded orientation revealed when control over the company changed hands. In May 2004, PNC Equity Management sold its controlling interest in Accubuilt to Paladin Capital Partners Fund, L.P., a private equity investment company with offices in Atlanta, Georgia, and Washington, D.C., and Hancock Mezzanine Partners III, L.P., an investment fund managed by John Hancock Life Insurance Company. Dominic D. Cuzzocrea, who served as chief executive officer of Accubuilt when the company gained its new backers, commented on the implications of the deal in a May 18, 2004 company press release. "The Accubuilt management team is delighted to partner with Paladin and with Hancock Mezzanine as we continue to grow and serve our markets more effectively," the statement read. "We thank PNC for their guidance and assistance with our growth over the last seven plus years and we are quite confident that Accubuilt will continue to prosper by delivering the best values to our diversified customer base, just as we have always done. Paladin shares Accubuilt management's goal to maintain our dominant position in funeral vehicles while diversifying into growth markets such as our recently acquired commercial van business. We have increased our funeral vehicle market share in 2004 while simultaneously growing our mobility van business into the third largest Ford pool account after less than two years in the industry." In the years ahead, Accubuilt promised to maintain its overwhelming lead in its core market and to broaden its presence in the specialized vehicle market.