Professionalizing and Growing a Family Business at Ohio Transmission Group
In its 50 year history, Ohio Transmission Group (“OTC”) had been successful building up a high quality management team and establishing strong relationships with customers and suppliers alike. At the time of Frontenac’s investment, the company had just rebounded from a recession and was seeking to grow geographically, expand supplier relationships, and increase margins. Challenges facing OTC included inherent cyclicality, vendor concentration, and professionalization.
OTC was a long-time family owned company that was well positioned to benefit from an institutional investor with an established track record of success in distribution. Frontenac set out to deploy key value creation playbooks around margin improvement, M&A, and consolidation.
The mission with OTC was straightforward: help a very good business be even better. Frontenac’s investment thesis was focused on enhancing the product offering in existing markets, consolidating in fragmented markets, and driving margins to industry leading levels. We also sought to form an engaged Board of Directors that would compliment the accomplished, in-place team. In spite of a focused strategy plan, OTC had successfully grown organically and with some limited M&A. Frontenac worked with management to professional processes, establish near-term plans, and develop a long-term strategic roadmap.
“The team at Frontenac provided OTC with invaluable support in a variety of tactical as well as strategic issues. They brought an analytical approach to decision making that helped to support improved overall performance. Frontenac was not only thoughtful in their day-to-day support, but they engaged with management in a positive and productive way to overcome challenging situations.”
– Phil Derrow, Chief Executive Officer of Ohio Transmission Group