This article is a part of the Business Transitions Forum.
His entrepreneurial journey
Alan Rickard’s entrepreneurial journey began a few years ago with the purchase of one company with a friend/neighbour. His entrepreneurial journey kept growing from there with the acquisition of two other companies.
“He was signing up to kind of run the company and then I would help invest and get the financing. That worked out really well,” he said.
The first company was Elreg Distributors, which closed in December 2019 just before the pandemic hit. The next was Northstar Industries, which he acquired in the fall of 2021, and then Oxford Hydraulics in August 2023.
The companies are all based in southern Ontario. Elreg Distribution is in the wholesale starter, alternator, voltage regulator, and component parts distribution business. Northstar Industries is a distributor and fabricator of specialized construction and industrial products. Oxford Hydraulics provides “Mission Critical Service” including repairs and maintenance of large industrial, farming and commercial equipment used in construction, farming, excavation etc.
“When we were looking at that first business, Northstar Industries, in the company there I think they had done some financing, but they were certainly doing their commercial banking with National (Bank of Canada). When I was looking to finance the deal as we were putting it together, I had gone to all the other banks.
“When I was finally talking to the owners they said ‘why don’t you talk to my contact at National Bank) and that’s when Sagar (Sethi) and I connected. The offer and the financing, it seemed like National Bank was a lot more interested in placing money in this sort of space - regional mid-cap space that we call it. The offer was far better, the terms not so much on the rate necessarily they were all kind of the same, but the terms that were there were very good for the type of thing that we were trying to do.”
His path to business ownership
The purchase of Northstar highlighted his solid relationship with National Bank, and that relationship continued to grow with the purchase of Oxford.
Rickard said National Bank was involved in financing the purchase in Elreg Distributors.
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Rickard said finding financing is just one piece of the puzzle for achieving business growth.
“We’re using sort of a leveraged approach of purchasing these small businesses,” he said. “But I will say probably even more so than just getting the approvals are the terms and the conditions that we’re able to work within.”
“And that’s what really facilitates growth within these small companies. The flexibility, the tools that are available to us that National Bank’s brought. That’s what’s really been helping to drive some of this growth.”
Working with National Bank of Canada
“It’s been a really great relationship. Because of the flexibility that we’ve had, we’ve been able to pay off that debt, the senior debt with the Elreg business, and almost turned around immediately and put up some bigger financing on this Oxford Hydraulics business that we closed on in August. And of course, the flexibility to look at the whole portfolio of what we have. I have a business where I own 50 per cent with one person, 50 per cent with another person, and then we have a third, a third each of this other one. National Bank has been able to look at that and say this is your portfolio of companies, here’s what the financing was. We got really aggressive in being able to do that which was the only way we would have been able to close and purchase a business of this magnitude.”
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