When an opportunity arose to acquire Harmony Concepts, a manufacturing company specializing in blending powders for nutritional and dietary supplements and health drinks, Coquitlam-based The Rhema Group leapt at the prospect. Having already looked into purchasing a facility in the United States, the acquisition gives Rhema a great opportunity to further expand its business in the US and increase capacity.
The company first began working with Utah-based Harmony Concepts last year and when the owners indicated they were looking to sell their business as they wanted to retire, Rhema seized the opportunity as having a blending facility in the US would enable them to move their product more efficiently and easily. This decision was also compounded by the fact that one of Rhema’s major clients had plans to expand aggressively into the United States.
“It was certainly great timing on both our parts as our acquisition of Harmony Concepts gave our company a platform to diversify our business and enter the consumer brands market,” shares Carlo Zarrillo, president and chief executive officer of The Rhema Group. “Moreover, having a facility in the US to support our US-based clients will enable us to lower our costs on labour and potentially on raw materials, helping us to better withstand margin compression.”
Working with First West Capital
Having already financed a shareholder buyout deal with Rhema in 2011, Robert Napoli, vice-president of First West Capital was confident in their existing partnership with the company’s management team and Rhema’s line of business. Napoli says, “Rhema has a proven strategy and solid results and we are so pleased to be able to partner with them for a second time and fund their latest US acquisition. We’re excited to see this company grow and be a part of their expansion plans.”
The First West Capital experience
Having already secured a sub-debt financing deal with First West Capital in 2010, Zarrillo really valued the strong relationship Napoli and the team have developed with Rhema. “We really enjoy working with the First West Capital team,” says Zarrillo. “This is the second loan we’ve secured through Rob and the team and both times, they have been extremely flexible, innovative and proactive in their approach. Since our first financing deal, they’ve really taken the time to get to know the ins and outs of our business, which is why we chose to partner with them again.”
Since our first financing deal, they’ve really taken the time to get to know the ins and outs of our business, which is why we chose to partner with them again.