Heritage Cutlery, Inc.

Division: Phoenix Capital Resources


Heritage Cutlery, Inc., the largest U.S. manufacturer of hot-forged scissors and shears for a wide variety of markets, was a profitable subsidiary of Rogers, Lunt & Bowlen Company ("RLBC").


Despite the positive cash flow of the Heritage business, the business did not fit into RLBC’s long-term strategy and RLBC was not re-investing the profits in the business to support its growth potential. In addition, the Heritage business had known environmental issues on the company-owned real estate that were continuing to be addressed over time. In order to maximize the value of RLBC’s investment and to help achieve its overall corporate goals, Phoenix Capital Resources was engaged as the exclusive financial advisor to sell Heritage Cutlery.


Phoenix Capital Resources began its due diligence, then prepared a Descriptive Memorandum, and was ready to go to market about a month later. Prior to going to market, a customer of Heritage Cutlery was identified as an interested buyer. Phoenix Capital Resources negotiated a premium purchase price in exchange for allowing a “pre-emptive” bid prior to starting the competitive sale process. The final sale price represented a very attractive multiple of adjusted EBITDA as a result of real synergies between the two companies.
When the strategic buyer expressed interest in Heritage, it noted that the environmental due diligence would be its top priority due to a negative experience with a prior real estate transaction. Maneuvering through the environmental due diligence issues and negotiating acceptable solutions for both sides proved challenging and nearly derailed the closing several times.

Over the course of seven months, Phoenix Capital Resources:

  • Assembled a strong professional team
  • Spearheaded the transaction process
  • Coordinated communications between numerous constituents
  • Managed expectations of the various parties
  • Mediated disputes to resolve environmental due diligence issues
  • Reached a successful closing despite numerous delays