When Brad Miller purchased IMW Industries Ltd. seven years ago, his main goal was to expand the manufacturer of compressed natural gas (CNG) equipment globally.
“It was around the time that the Canadian dollar was starting to shoot up, which was causing problems for the manufacturing industry,” Miller said in a recent interview with Business in Vancouver.
“Downsizing wasn’t an option; shutting down certainly has never been an option. Expanding our product lines, establishing subsidiaries in China, Colombia, Bangladesh and coming up with better, more efficient ways of doing business – not to mention a top-notch product – that’s the strategy not only for survival, but for continued success.”
The Chilliwack-based company, which makes and services natural gas compressors, dispensers, storage systems and associated parts for vehicle fuelling and industrial applications, has since enjoyed what First West Capital vice-president Robert Napoli calls “a non-stop growth story.”
“I saw Brad’s ability to grow and encourage the value of the business from the first,” said Napoli who, through former employer Vancity Capital, helped finance Miller’s acquisition of IMW in 2003. “He was able to see a rough diamond when he purchased the firm in that, while the technology certainly had a large market application at the time, it needed some refinement.”
With a background in mechanical engineering, Miller set about streamlining the business, installing new machinery that slashed manufacturing time and cutting transportation costs by redesigning the enclosures for IMW’s CNG units, which had previously been too large to fit inside a shipping container.
“He went in there and he simplified things so that his offerings became much more attractive to an export market,” Napoli told BIV. “Brad is a strong entrepreneur with a common-sense approach and an engineer’s eye for improving customer value. One could say he’s taken IMW and made it into the BMW for its market.”
Indeed, IMW has grown by leaps and bounds since Miller took over as owner and president.
“Our revenue has jumped from $10 million to over $50 million; we’ve created new products and technology that provide maximum performance, generate revenue, minimize operating expenses and reduce carbon emissions for our customers; and employee-wise, we’re still growing,” he confirmed. “We’re in the alternative fuel business, which is a fairly hot sector right now, so I see plenty of opportunities on the horizon.”
In fact, more and new opportunities for expansion is exactly what led Miller to finalize the sale of his company to California-based Clean Energy Fuels Corp. – a provider of natural gas to alternative-fuel vehicles and a longtime IMW client – this past summer.
“I was approached by a couple of companies that were interested in us, either in terms of forming a strategic alliance, or from an investment or acquisition perspective,” he explained. “I ended up negotiating with them on my own and, after a number of months … we reached a deal.”
The deal – worth $125 million in cash and stock plus a cash earn-out arrangement – was eventually inked with Clean Energy rather than the other contender (which made a similar, all-cash offer) because, says Miller, “it was a better fit.”
“Besides being in business to make money, I really want to see this natural gas opportunity keep on growing in North America, and I want to see IMW continue along the same growth track,” he explained. “Clean Energy has been a big user of our equipment, so it provided more certainty for growth [than the other contender].”
Though some worried the sale would result in job losses or spell the end of the firm’s B.C. presence, Miller assured BIV there are no plans to reduce the company’s local workforce or move its operations elsewhere (in fact, since the sale was finalized in July, IMW has added another 40 employees and ramped up its production in Chilliwack).
“What this acquisition means is that we’re part of a bigger company, which gives us access to more resources and a bit of a bigger voice,” Miller said. “There’s more security for our employees this way and there’s no desire of [Clean Energy] wanting to move our manufacturing base, seeing as they’re not a manufacturing company.”
As for his own fate, Miller says he plans to stay at IMW’s helm for at least another four years.
“I’m still here and plan to stay on and run the business,” he said. “It’s exciting for me to be able to focus on the future and not necessarily have to deal with all the financial details that an owner-operator has to.”