O. M. Scott & Sons and W. Atlee Burpee Division
Divested by ITT Corporation

Initial failed auction creates opportunity for the confidential introduction of an aggressive, new buyer...

In 1984, the ITT Corporation, one of the original conglomerates, had begun to reassess its business units both in terms of core competencies and those having significant size and growth potential. Over a decade earlier, O. M. Scott & Sons and W. Atlee Burpee ("Scott/Burpee") had been acquired and formed one division. While this division had significant consumer brand awareness, it was deemed to be outside the parent's "hold and grow" criteria. ITT decided to take the company to market in a major investment banking auction and, after selecting a buyer, had been unable to close.

Scott/Burpee, with over $200 million in sales, are major brand names in the lawn and garden markets. "Scott" was the largest brand name manufacturer of lawn care products and "Burpee" was a major seed and bulb catalogue sales organization. The lawn and garden market was viewed as a growth industry, and, in addition, had a number of opportunities for consolidation.

After a failed auction, we did not want to go down that path again. Valufinder was able to bring to us less than a handful of highly qualified buyers. With their help, we were able to quickly move forward and close a transaction. We subsequently had another transaction that was too small for our bulge bracket investment bankers and decided to do it in house. We contacted Valufinder who again introduced us to an excellent group of buyers, one of whom bought the company. Valufinder has been professional, fast, and discreet in all their dealings with us. Leonard Nathanson
Director of Mergers & Acquisitions
ITT Corporation

In 1985, Valufinder, having previously identified this division as a corporate orphan, and aware of the failed auction the prior year, contacted ITT about the possibility of selling. ITT had decided to hold the business because the failed auction had caused personnel problems, which had in turn caused performance issues. Valufinder was convinced that, ultimately, ITT would reconsider selling, and maintained ongoing contact with the ITT corporate development office.

In 1986, ITT reconsidered its position and decided to sell. However, after the failed public auction, ITT wanted its own corporate development people to handle the sale quietly and discreetly, without any public statements until the transaction closed. After several meetings and, after assuring ITT that Valufinder could discreetly select and qualify a handful of exceptional buyers, we were given the go ahead to introduce the Scott/Burpee Division to a limited group of buyers.

One of these buyers, Clayton & Dubilier, ultimately purchased the company, recognizing that O. M. Scott represented an outstanding platform for both internal growth and for adding on smaller competitors for their synergies.

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