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A Strategic Acquisition Helps an Evergreen Portfolio Company Grow

In February 2020 BI Cooperative, a newly formed worker cooperative, received an investment from The Fund for Employee Ownership (TFEO) to acquire the assets of Berry Insulation in a move to convert the company to employee ownership. BI Cooperative recently received a follow-on investment from TFEO to complete the strategic acquisition of the assets of Barberton, Ohio-based R-Tek Insulation, Inc.

Since its founding in 1999, family-owned R-Tek has installed advanced insulation in more than 2,000 homes in Northeast Ohio and beyond. Berry Insulation was founded in 2009 by Martin Berry, a former General Motors manufacturing executive, who had specialized in quality control. 

The company initially focused on serving commercial insulation installations. But it later began offering residential weatherizing services as well, taking advantage of Obama-era stimulus funding that supported the weatherizing of residential homes. 

With the acquisition, BI Cooperative has now added the capability to employ spray foam and wet cellulose insulation to its arsenal, along with the experienced employees who are well-versed in these applications. These insulation delivery methods are widely considered more innovative and effective for customers.

“It seemed to be a good fit, given their locations, strategic capabilities and experienced technicians,” says Martin Berry. “There are some process capabilities they have that we do not, and vice versa. And we are gaining three very experienced technicians.” Together, the combined companies will have approximately 20 employees and post annual revenues increases of 30%. 

The Fund for Employee Ownership, an Evergreen initiative designed to preserve local jobs, helps employee-owners build wealth and assists small business owners interested in transitioning toward retirement. The Fund targets companies with an EBITDA between $500,000 and $3 million, across most business sectors. 

Said Brett Jones, Evergreen’s Executive Vice President: “This transaction is another example of one of our mantras: how patient capital can unlock exciting opportunities.”

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Evergreen Cooperatives