Category Archives: Machinery & Equipment

Blog Archive for Machinery & Equipment Category Posts

Plating Equipment Appraisals

M&E Appraisal Associates, Inc. (“M&EAA”) recently appraised the machinery & equipment of a plating company. M&EAA are experienced plating equipment appraisers, and have provided certified plating equipment appraisals since 1990.

The subject company is a electroplating services provider located in South Carolina.

The specific assets appraised by M&EAA included multiple electroplating lines consisting of plating tanks, rectifiers, filter pumps, crane systems, plating barrels & racks, etc. Support equipment included waste water treatment & filtration equipment, sludge burners & presses, fume scrubbers, parts finishing & polishing machines, laboratory equipment and other general plant equipment.

Plating Equipment Appraisals
General view of electroplating line

M&EAA relied primarily on the sales comparison or market approach in valuing the subject items (although the cost and income approaches were considered).

Parties contacted as part of the market research process included equipment dealers or resellers of used equipment, original equipment manufacturers (OEM’s), and other such sources.

Additionally, data obtained from published sources and data maintained in M&EAA’s files was also considered. Final sources of information considered included published price guides, current sales offerings, and/or recent sales of comparable items, including auction sales. Based on the use of standard appraisal methodology and the consideration of all relevant data, values were concluded.

Plating Equipment Appraisers
Electroplating line: view of plating tanks

Plating equipment appraisals – final conclusions: the subject machinery & equipment was determined to have moderate appeal under a removal value premise. There is strong demand for the subject equipment in general, but environmental considerations did temper final value conclusions.


Hinge Manufacturing Equipment Appraisals

M&E Appraisal Associates, Inc. (“M&EAA”) recently appraised the machinery & equipment of a hinge manufacturing company.

M&EAA are experienced door & gate hinge manufacturing equipment appraisers and have provided certified hinge manufacturing equipment appraisals since 1990.

The subject company is a manufacturer of architectural hinges, geared hinges, single acting spring hinges, double acting spring hinges and other like kind specialty products.

M&EAA appraised the subject items under both the Fair Market Value and Orderly Liquidation Value scenarios. The appraisal was accomplished for loan consideration purposes for which the subject items were to be pledged as collateral.

The appraiser relied primarily on the  sales comparison or market approach in valuing the subject items (although the cost and income approaches were considered). Parties contacted as part of the market research process included equipment dealers or resellers of used equipment, original equipment manufacturers (OEM’s), and other such sources. Additionally, data obtained from published sources and data maintained in M&EAA’s files was also considered. Final sources of information considered included published price guides, current sales offerings, and/or recent sales of comparable items, including auction sales. Utilizing standard appraisal methodology and after the consideration of all relevant data, values were concluded.

Hinge Manufacturing Equipment Appraisers

The subject machinery & equipment included an assortment of stamping presses (OBI, gap frame, straight side), coil steel stamping lines, screw making machines, dedicated hinge manufacturing equipment, CNC machine tools, tool & die shop equipment, plating and plating support equipment, general plant support equipment, material handling equipment and quality control & lab equipment.

The “standard” machine tools were considered to be desirable to other like kind operators and end users. The more “special” hinge making equipment was also determined to be desirable (to a lesser degree), as there is currently no like kind equipment available in the domestic marketplace. Common use items such such as air compressors, air dryers, forklifts and general support items would be readily salable to wide variety of other commercial or industrial end users.

Hinge manufacturing equipment appraisals – conclusions: the domestic hinge manufacturing market continues to be greatly impacted by offshore producers.  This somewhat limits the potential demand for dedicated hinge making equipment. The general use equipment was not impacted by these economic factors. In general, the concluded values were favorable for the subject items appraised due to their mix, current market demand, and typical good condition.

Mulch & Soil Processing Equipment Appraisals

Mulch Processing Equipment Appraisers

M&E Appraisal Associates, Inc. (“M&EAA”) recently appraised the machinery & equipment of a mulch & soil processing company. M&EAA are experienced mulch processing equipment appraisers and soil processing equipment appraisers, and have provided certified mulch processing equipment appraisals and soil processing equipment appraisals since 1990.

The subject company processes, treats, colors and bags various types of mulches for a variety of end uses. The subject company also mixes and blends a diverse range of soils and compost materials.

The specific assets appraised by M&EAA included a soil production line, (2) mulch bagging lines, a mulch coloring system, (2) portable downswing grinders, as well as numerous screens, conveyors, trucks, trailers, excavators, wheel loaders, skid steer loaders, forklifts and other related items.

Soil Processing Equipment Appraisers

M&EAA relied primarily of sales comparison or market approach in valuing the subject items (although the cost and income approcahes were considered). Parties contacted as part of the market research process included equipment dealers or resellers of used equipment, original equipment manufacturers (OEM’s), and other such sources. Additionally, data obtained from published sources and data maintained in M&EAA’s files was also considered. Final sources of information considered included published price guides, current sales offerings, and/or recent sales of comparable items, including auction sales. Based on the use of standard appraisal methodology and the consideration of all relevant data, values were concluded.

Certified Mulch & Soil Processing Equipment Appraisals

The mulch & soil processing related items were considered to be desirable to other like kind operators. Common use items such as standard, trucks, tractors, excavators, wheel loaders, skid steer loaders, and forklifts, etc. would be desirable to users of like kind equipment in a wide variety of other commercial or industrial applications.

Mulch processing equipment appraisals – conclusions: with upward trending housing starts and more cash to spend on home improvement projects, most manufacturers of both mulch and to a lesser degree soils are seeing steady sales growth in U.S. regional markets. Concluded values were favorable for the subject items appraised due to their mix, current market demand, and good condition.

Trench Shoring & Shielding Equipment Appraisals

Trench shoring equipment appraisers

Trench shoring equipment appraisers

M&E Appraisal Associates, Inc. (“M&EAA”) recently appraised the machinery & equipment of a trench shoring & shielding equipment company.

The subject company is a manufacturer and supplier of trench shoring & shielding systems. These systems include trench boxes, vertical hydraulic shores, excavation support equipment, etc.

Trench shoring is the process of bracing the walls of a trench to prevent collapse and cave-ins. Several methods can be used to shore up a trench. Trench shields (also called trench boxes or trench sheets) are steel or aluminum structures used for protecting utility workers while performing their duties within a trench and avoid cave-ins.

The specific assets appraised by M&EAA included steel trench shields, steel manhole shields, trench system components, slide rails, steel plates, I-beams, hydraulic shores and other related support items. M&EAA has over 25 years experience providing trench shoring equipment appraisals and trench shielding equipment appraisals.

Trench shielding equipment appraisers

Trench shielding equipment appraisers

As there is limited comparable sale information available, the appraiser relied primarily on the cost approach in order to value the subject items.

The cost approach involves the use of the current replacement cost new of an item, less all forms of depreciation to determine the value of a subject property. Depreciation in terms of the cost approach includes physical deterioration, functional obsolescence, and economic obsolescence.

Appraisal conclusions: Cave-ins are the most feared hazard workers in the underground utility industry face while working inside an excavation four feet or more in depth. Prevention methods such as using adequate shoring systems & shielding systems are critical. An upward trend in underground utility projects (new and repair/replacement) coupled with increasingly stringent OSHA requirements results in high demand for trench shoring & trench shielding equipment. Concluded values were extremely favorable due to the mix, current market demand, good condition, and long inherent life of the subject items. 

Metalworking Equipment Appraisals

Metalworking equipment appraisers

Amada Vipros 357 Queen CNC Turret Punch

M&E Appraisal Associates, Inc. (“M&EAA”) recently appraised the machinery & equipment of a precision metalworking and powder coating operation.

M&EAA has over 25 years experience providing metalworking equipment appraisals and powder coating equipment appraisals.

The primary metalworking equipment included: CNC laser cutting machines; CNC laser punch presses and turret punches; CNC press brakes; CNC turning centers; CNC vertical and horizontal machining centers; CNC vertical mills; robotic welding systems; precision spot welders; powder coating systems/lines; quality control equipment (coordinate measuring machines and laser measuring systems), plant support equipment (air compressors; air dryers; chillers; dust collectors), material handling equipment, forklifts, vehicles, etc.

Original equipment manufacturers included: Amada, Promecam, Cincinnati, Mori Seiki, Brother, Daewoo, Fadal, Kitamura, Yama Seiki, Panasonic, Motoman, Nordson, etc. These manufacturers are well known names in their respective industries, and are frequently sold on secondary markets.

Metalworking equipment appraisals

Inline Wash Tunnel

As in many operations, the subject machinery & equipment ranged widely in age. The subject company’s machinery & equipment ranged from manufactured in the 1990’s to late model/manufactured in 2017-2018. Values for CNC machinery & equipment in particular is very age sensitive. The subject machinery & equipment was observed in good condition and was frequently maintained. Many of the subject items had been upgraded over the years.

Appraisal conclusion: The subject machinery & equipment was appraised for loan consideration purposes under the Fair Market Value scenario. As is universally the case, newer CNC machinery & equipment had high value, while older CNC equipment (typically 10+ years) had lower to residual value. Additionally, the higher degree of installation/custom configured items such as the powder coating line (including multi stage wash line; pass through drying tunnel; overhead conveyor system) inherently have high removal costs and resultant lower Fair Market Value. As the subject company had a large population of newer and well maintained CNC machinery & equipment, the concluded Fair Market Value was favorable.   

Paving Contractor Machinery Appraisals

M&E Appraisal Associates, Inc. (“M&EAA”) has over 25 years experience providing paving contractor machinery appraisals.

M&EAA recently appraised the machinery & equipment of a asphalt paving contractor.

The primary asphalt paving machinery & equipment included: skid steer loaders; rollers; pavers; planers & planer attachments; milling machines; dump trucks; trucks; truck tractors; trailers, etc.

Domestic demand for asphalt is anticipated to rise in the near term future. Asphalt demand in highway and street applications will yield strong gains based on growth in government funding and rising highway and street construction activity.

The subject machinery & equipment was observed in good condition was frequently maintained. Many of the subject items had been upgraded over the years.

An optimistic economic outlook, the good condition of the subject items as well as their strong secondary market appeal resulted in favorable value conclusions by the appraiser.

Rubber Products Manufacturing Machinery Appraisals

M&E Appraisal Associates, Inc. (“M&EAA”) has over 25 years experience providing rubber products manufacturing machinery appraisals.

M&EAA recently appraised the machinery & equipment of a manufacturer of rubber oil seals, rubber valve stem seals and rubber o-rings.

The primary rubber manufacturing machinery & equipment included: rubber mixing mills; rubber extruders; vulcanizing presses; vacuum presses; rubber injection presses; trim presses/machines; wax spin coating machines; custom cleaning machines; test & quality control equipment; general plant support equipment; material handling equipment; mobile equipment, etc.

The subject rubber production equipment ranged in age from new to manufactured in the 1990’s. A majority of the machinery & equipment was specially designed and built by original equipment manufacturers (OEM’s) in Japan, Taiwan and Korea. As part of the cost approach methodology, the appraiser was very reliant on original cost information and replacement cost information provided by the OEM’s and their representatives.

The company manufactures a majority of their products for use in the automotive industry. In the utilization of the cost approach, the appraiser was very diligent in the consideration of economic obsolescence. Based on current market research reports, industry revenue is expected to decline slightly despite sustained strong demand for automotive rubber components from downstream buyers. Weakening demand from other key markets, as well as sharp drops in the price of natural and synthetic rubber inputs, is anticipated to further constrain industry performance. Import competition is expected to intensify over the next five years. Lower labor costs and a relatively less stringent regulatory environments in countries outside of the U.S. will weigh on domestic industry operators.

In summary, the primary rubber products manufacturing machinery is newer, in good condition and produces high demand automotive related items. The subject machinery & equipment is not solely dedicated to the manufacture of automotive related end products. The non dedicated nature of the machinery & equipment supports favorable value conclusions, which were somewhat tempered by the economic considerations previously described.

Wire Production Machinery Appraisals

M&E Appraisal Associates, Inc. (“M&EAA”) has over 25 years experience providing Wire Production Machinery appraisals.

M&EAA recently appraised the machinery & equipment of a wire products manufacturing company. The appraisal was provided for asset based loan considerations, and concluded under the Orderly Liquidation Value concept.

The subject company specialized in the production of nickel alloy wire & bar, aluminum rod & bar, and other related high end wire products. The subject machinery & equipment was specific to the manufacture of high grade wire products, and is superior to “traditional” wire production equipment.

The primary production equipment included: multiple hole/block wire drawing lines; rod preparation lines; wire down coiler lines and wire down coilers; a multiple strand copper coating line; a continuous wire strand annealing system with annealing furnace; a large capacity wire down coiler system; a large capacity wire shaver system; and “traditional” wire drawing and production machinery & equipment.

The subject wire production equipment was newer, manufactured from 2010 to 2015. The original equipment manufacturers are well recognized names in the wire production industry. This type of more specialized wire production equipment is very expensive to buy new, and used machinery of this type seldom comes up for sale.

It is important to note that most of the production lines are installation intensive. The degree of installation and size of the machines would affect value under a removal based sales scenario. The market for the high end production equipment includes but is not limited to other North American competitors. It is noted that the limited amount of traditional and older wire production equipment would have lesser demand and would most likely be sold to other regional wire producers.

In summary, the primary wire production machinery is newer and has utility in the specific manufacture of high end wire alloys and related products. The replacement cost for this type of equipment is extremely high. The subject machinery & equipment would be very desirable to other end users, and would resultantly have extremely high resale value, even under forced sale conditions.

Carbon Based Products Manufacturing Machinery Appraisals

M&E Appraisal Associates, Inc. (“M&EAA”) is expert in the provision of Carbon Based Products Manufacturing Machinery appraisals.

M&EAA recently appraised the machinery & equipment of a carbon based products manufacturing company. The appraisals were provided for asset based loan considerations, and concluded under the Orderly Liquidation and Fair Market Value-Installed value concepts.

Orderly Liquidation Value is the estimated gross dollar amount which could typically be realized from an orderly sale of the subject assets, held under forced or distressed conditions, with a limited marketing period. Inherent in the definition is the disposal of all assets in an “as is” condition with all expenses of removal and transportation incurred by the buyer. It is assumed that a professionally managed sale would be conducted by a qualified party familiar with this type of equipment.

In the case of of the subject company, the values concluded reflect an approximate four month period in which to sell all items. It is assumed that sale proceedings would begin immediately upon the decision to cease operations. This is important as allowing the subject items to sit idle and unattended for an extended period of time could have a significant negative impact on value.

Fair Market Value–Installed is an opinion, expressed in terms of money, at which the property would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or to sell and both having reasonable knowledge of relevant facts, considering market conditions for the asset being valued, independent of earnings generated by the business in which the property is or will be installed, as of a specific date.

The value definitions are based on the published definitions set forth by the American Society of Appraisers in the text, Valuing Machinery & Equipment (2005).

The subject machinery & equipment included, but was not limited to: raw material handling and conveying equipment; crushers & screens; a feed enhance reactor furnace with associated post combustion equipment; mixing & densifying equipment; a particle fusion reactor furnace with post combustion equipment; finishing & bagging equipment; material handling equipment; laboratory equipment.

Appraisal conclusions: the subject machinery & equipment is primarily utilized in the manufacture of products designated for use in the iron and steel industry. As would be expected, the installed value concluded for the subject machinery & equipment was high, due to the substantial costs associated with the installation of a complex dry products chemical processing facility. The value concluded for the subject machinery & equipment under removal, as also would be expected, was very low due primarily to excessive dismantling, rigging, and shipping costs.

Oil & Gas Pipe Distribution Machinery Appraisers

M&E Appraisal Associates, Inc. (“M&EAA”) is expert in the provision of Oil & Gas Pipe Distribution Machinery appraisals.

M&EAA recently appraised the machinery & equipment of a specialty pipe, tubing, and metals distributor. The appraisal was provided for purchase price allocation purposes, and was concluded under the Fair Value valuation concept.

Fair Value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

The definition utilized is that issued by the Financial Accounting Standards Board summary statement No. 157 (“FAS 157”). This Statement defines Fair Value, establishes a framework for measuring fair value in generally accepted accounting principles (“GAAP”), and expands disclosures about fair value measurements.

Appraisal conclusions: the subject machinery & equipment was very new, which was the primary factor in a very favorable value conclusion. The company maintained numerous international subsidiaries. These locations were valued on a desktop basis.

 A desktop approach is a method of analysis which identifies and values the subject items without the benefit of inspecting them. The appraiser specifically relied on information provided by the subject company as the basis for reporting. The appraiser assumed this information to be accurate. If the information was found to be other than that assumed, the appraiser could arrive at a differing opinion of value. By definition, a desktop appraisal may not contain the detail and content that would be normally included in a standard appraisal. The information provided was considered to be sufficient in order to accurately identify the subject machinery & equipment for the purpose of developing credible appraisal results.