Generational Equity Advises Kyle’s Custom Woodshop in its Sale to 1847 Holdings

By Generational Equity

10/28/2020

Generational Equity, a leading mergers and acquisitions advisor for privately held businesses, is pleased to announce the sale of its client, Kyle’s Custom Woodshop, Inc., to 1847 Holdings LLC. The acquisition closed September 30, 2020 and details were not disclosed.

Kyle’s Custom Wood Shop, Inc. (“Kyle’s”), located in Boise, Idaho, is a leading custom cabinetry maker servicing the direct-to-builder and new construction markets. Kyle’s has designed, built, and installed custom cabinetry for new construction since 1976. In the last several years the Company’s production has been oriented to working primarily with custom and semi-custom builders.

1847 Holdings LLC (OTCQB: EFSH), located in New York, New York, is a publicly-traded partnership that combines the most attractive attributes of owning private, lower-middle market businesses with the liquidity and transparency of a publicly-traded company. 1847 Holdings seeks to generate returns for shareholders in the future through consistent, annual distributions of operating subsidiary income and capital appreciation, resulting from the timely sale of operating subsidiaries.

“Kyle’s has grown revenue at a 7.1% CAGR over the past three years with 30%+ operating income margins, well above industry averages,” commented Ellery W. Roberts, CEO of 1847 Holdings. “They have a solid track record of positive cash flow and a base of well-known regional clients with relationships and recurring revenue spanning nearly a decade. With a clean capital structure and no debt, we should be afforded substantial flexibility in financing which could help unlock value creation through participation in previously neglected opportunities.”

Strong housing demand in the region is driven by out-of-state immigration into Idaho. Current operations are focused primarily in the Boise area, providing opportunities to capitalize on high-growth adjacent regions. In addition to regional expansion, 1847 Holdings plans to expand capacity by increasing the network of builders, participating in new bids, and investing in facilities and labor resources. Product line expansion and broadening sales channels to include multifamily housing, remodels, and DIY segments could further accelerate growth.

Generational Equity Executive Managing Director of M&A – Western Region, Stephen Crisham, led by Sr. Managing Director Mergers & Acquisitions, Fred Zweifel, with support by Managing Director-Western Region, Lori Galloway, closed the transaction. Senior Managing Director Eric Colton established the initial relationship with Kyle’s.

“This was a good strategic fit for 1847 Holdings expansion into the growing regional network of builders,” said Zweifel.