Haig: Back at your service
GREEN BROOK, N.J.--When Haig Service Corporation, a company installing and servicing fire and security alarm systems, bought the assets of Aerwav Integration Services, it acquired a number of commercial fire accounts, as it expected - and two years of financial and legal hassles it had not anticipated.
Fortunately, Haig has resolved those issues, having completed a $1,625,000 credit facility with TD Banknorth that Ã¢â‚¬Å“restructured and dramatically lowered the former $2 million note owed to the estate,Ã¢â‚¬Â said Richard Haig, president and CEO of Haig Services Corporation.
In January 2006, Haig used his 35-year-old family business as collateral to purchase Aerwav assets in New Jersey, Tampa, Orlando and Fort Lauderdale, Fla., an investment he considered Ã¢â‚¬Å“a large infrastructure gain ... a launching platform.Ã¢â‚¬Â However, Ã¢â‚¬Å“it quickly became evident that it was not a launching platform, it was more of a turnaround situation.Ã¢â‚¬Â Then the legal battles began, where the estate that owned Aerwav attempted to seize the assets that Haig had purchased.
During this time, Haig Service - a company with 50 employees and about $150,000 in RMR - was still profitable and growing year after year. Ã¢â‚¬Å“The problem was not that we didnÃ¢â‚¬â„¢t have a good company, the problem was that we didnÃ¢â‚¬â„¢t have ... the working capital and we didnÃ¢â‚¬â„¢t have the funds to buy out the estate that still owned our company,Ã¢â‚¬Â he explained.
With the funding now worked out, Haig is focused on Ã¢â‚¬Å“doing what we originally wanted with the purchase,Ã¢â‚¬Â which was to use this acquisition as a launching platform to grow his service business. HaigÃ¢â‚¬â„¢s revenues from fire and security installations have continued to increase over the past three years, but they are now a much smaller percentage of overall revenues. (ItÃ¢â‚¬â„¢s gone from 65 to 75 percent down to 37 percent, he said.) Service work, on the other hand, has dramatically increased as a percentage of revenues.
HeÃ¢â‚¬â„¢s now Ã¢â‚¬Å“reaching out with our new network team of bankers, M&A people, advisors, and partners for companies in and outside our existing markets to either add via acquisition, merge with, or partner with.Ã¢â‚¬Â Haig emphasized, Ã¢â‚¬Å“we are not serial account buyers, but business people and entrepreneurs looking to build value in our service organization.Ã¢â‚¬Â
Haig is pleased to have resolved the financial issues, particularly during these challenging times in the credit market. He credits his customers and vendors (he mentions ADI in particular, and Chick May and Bob Leone of Monitoring Partners in Delray Beach) who have Ã¢â‚¬Å“stuck with us through tough times,Ã¢â‚¬Â and new business partners such as John Colehower of Mergers & Acquisitions and Gregory Spurr of TD Banknorth with helping to bring this deal to fruition.