Adding Value as a True Partner
Sanda Kan Industrial Ltd.
Example of Adding Value as a True Partner:
Sanda Kan is a leading Hong Kong based manufacturer of model trains and related products with its manufacturing operations located in mainland China. In one of the first leveraged recapitalizations completed in China, ZS acquired a majority interest in Sanda Kan from its 83-year old owner in mid-2000. Post-closing, ZS worked closely with Sanda Kan’s management team to expand the core business through new customer introductions and to pursue new product opportunities by leveraging off of the Company’s design, engineering and manufacturing capabilities. For example, ZS facilitated a relationship with the owners of one of the leading model train marketers in the world which resulted in this company shifting all of its U.S. production to Sanda Kan and becoming one of Sanda Kan’s largest customers.
After successfully increasing revenues and earnings at the Company over a several year period, ZS and the Company were approached by an Asian investment firm interested in buying the Company. Wanting to capitalize on the significant value that had been created at the Company while still believing in its future growth prospects, ZS structured a transaction in which we and our investment partners (which included the former owner and senior management) received a significant amount of cash while retaining a large minority equity position in the Company.