CASE STUDY:
Horizontal Drilling Company
Size at acquisition:   $3MM EBITDA
Size at exit:               $25MM EBITDA
   *Based on a 5-year investment
Strategies
▫Relocating the revenue mix from volatile oil and gas industry to the growing 5-G industry
▫ Focusing on higher margin services such as emergency repair, engineering and signaling
▫ Geographic expansion into multiple states to minimize seasonality
▫ Strong focus on accretive acquisitions at <3x multiples across new regions
▫ Consolidated multiple companies across the communication services vertical
Challenges
Sponsor Team was unable to execute the plan and needed to be replaced with another Sponsor / Turnaround Team
Oil and Gas downturn in 2010 forced a premature transition to telecom services
Not enough reserves for CAPEX and maintenance hindered the Company’s growth in initial years of ownership
Lessons
Our biggest learning was that we need to stay close to the asset. Board-level information is not sufficient to maintain an accurate pulse of performance and challenges. Additionally, we needed to support company systems and processes to ensure greater success.
