Revitalizing a distressed limestone business
Indiana Limestone Company is the leading producer of Indiana limestone building products and materials in the United States. Based in Bloomington, Indiana, with legacy operations dating to the mid-1800s, this vertically integrated company controls 70 percent of Indiana’s dimensional limestone and 30 percent of U.S. reserves. Indiana Limestone’s products are chosen by owners and designers of commercial, institutional and residential buildings ranging from classical to high-tech in architecture and performance.
Wynnchurch acquired the senior secured bank debt of Indiana Limestone in January 2014 and acquired the company’s assets pursuant to a Chapter 11 bankruptcy proceeding in May 2014.
Indiana Limestone represented an opportunity to acquire at an attractive valuation a market leader in an industry with high entry barriers. Prior owners had restricted capital investment while liquidating excess inventory to generate cash. This eventually led to significant declines in revenue and EBITDA when inventory levels dropped and inventory quality was compromised.
In a sale process mandated by Indiana Limestone’s lenders, Wynnchurch offered to purchase the debt they held, facilitating a quick exit by the lenders.
After successfully purchasing the debt, Wynnchurch moved rapidly to fund the company’s turnaround in bankruptcy and consolidate operations, exiting unprofitable business lines and rightsizing its labor force, followed immediately by hiring new personnel, initiating new equipment purchases and realigning production operations.
Wynnchurch hired a new CEO and CFO with significant building products experience to lead the turnaround. These executives have significantly top-graded personnel and implemented new processes and systems, enabling the company to expand operations, improve its production capabilities and build a higher-value inventory mix.
In October 2018, Indiana Limestone, North America’s largest producer of natural dimensional limestone and Indiana limestone building products, merged with Polycor Holding, Inc. (“Polycor”) North America’s largest natural dimensional stone producer positioning the combined business as the solution of choice for architects, builders, dealers and other stakeholders in the natural stone value chain.
Polycor and Indiana Limestone management continue to advance a growth agenda, developing multiple opportunities in new and existing product lines, continuously improving operations in a network of quarries, manufacturing facilities and retail stores, and improving the company’s go-to-market strategy leveraging complementary existing and new customers and channels.