When CHS acquired majority ownership of Utiliserve in 1997, the $60 million company had already established itself as the eighth largest value-added distributor of electrical transmission and distribution products and services for the U.S. utility industry.

Utiliserve distinguished itself by building strong and loyal relationships with customers, which the company planned to leverage into alliance contracts over time. It also retained positive relationships with suppliers. This translated into more robust product and service offerings and better pricing than competitors.

CHS’s substantial experience with distribution companies helped Utiliserve move forward with its growth strategy. We assisted in identifying, negotiating and closing five add-on acquisitions to support the company’s efforts to lead their industry in consolidation. We also brought new management talent to complement the existing team in areas such as inventory control and purchasing in order to enhance the company’s infrastructure and accommodate its expected expansion.

Utiliserve built a network of 30 branches in 15 states throughout the central and northeast regions of the country. The company had grown substantially with an estimated $229 million in sales in 2002, making it the second largest distributor in its industry.

CHS began the process of exiting this investment in early 2002. The growth and success of the company enabled CHS to attract a strategic acquirer. The sale, which closed in August 2002, resulted in an IRR of 42%.