Berea Machine Shop, 23-Year Kentucky Contractor with Real Estate

Full Editorial Writeup

This is a commercial machine shop in Berea, Kentucky that has been operating for 23 years, offered together with the real estate it sits on. The package includes an approximately 6,250 square foot building on 13 acres, which gives a buyer meaningful room for expansion or additional facilities. With 5 full-time employees and roughly $750,000 of FF&E plus $50,000 of inventory included, this is a tangible-asset-heavy acquisition rather than a goodwill play.

The shop does custom machining work for a client base that is not fully disclosed, and the seller notes there are prospective contracts currently in development that would transfer at close. On $1.7M of revenue it throws off $888,946 in reported cash flow, which is an unusually high margin for a 5-person machine shop and the single most important number to verify. Five years of tax returns and a preliminary P&L are available to qualified buyers under NDA.

The asking price of $5M covers both the operating business and the land and building, so the headline 5.62x multiple is not a clean operations multiple. A buyer should strip out the real estate value and the equipment value before judging what they are actually paying for the earnings stream. The owner is willing to stay on for 6 to 12 months to hand off client relationships and operations, though there is no seller financing on offer.