Peter Cosgrove is the chief executive of the ATA Group, which manufactures precision tungsten carbide burs and pneumatic grinding tools.
After 16 years with the Jefferson Smurfit Group, including four years as CEO of Smurfit Packaging on the US west coast, Cosgrove decided in 2006 to exit the corporate world and return to Ireland.
His ambition was to invest in, and run, an indigenous manufacturing and exporting business with potential to grow a world market share.
In 2008 he led the acquisition of precision engineering business ATA Group headquartered in Cavan.
Immediate investments in capital, with support from Enterprise Ireland, and in management personnel, helped the company to grow substantially.
Today, the ATA Group has more than 1,200 distribution customers, operating in 65 countries. About 210 people are employed worldwide including 100 in Ireland.
What vision prompted you to start your business?
What prompted my investment, and that of others, into the ATA Group in 2008 was an appreciation of the technical quality of the product produced, the quality of personnel and a strong belief that ATA Group had the potential to become a world-leading business in its target market.
I worked with the support of Peter Crowley and Neil Hughes at FL Partners in Dublin to raise the equity and bank debt to allow us to complete the 2008 acquisition of ATA Group. We were able to get support because prospective investors saw the potential in adding an experienced management team to a well-invested technically capable company.
What was your "back-to-the-wall" moment and how did you overcome it?
Within six months of the acquisition the economic crisis hit the industry full-on, leading to a 30 per cent decline in sales year on year and an even greater EBITDA [earnings before interest, taxes, depreciation and amortisation] impact.
We got huge support from highly flexible employees to ensure we were able to take out as much cost as possible.
We were also able to take advantage of a suddenly soft economic environment to get cost reductions throughout the supply chain. Recovery in our main export markets took hold in late 2010 and by 2011 we were already ahead of our previous peak year 2008. We had rehired all temporary lay-offs, were back on full overtime and reversed pay cuts.
What moment or deal would you identify as the "game changer" for the company?
The acquisition of the bur division of our biggest competitor SGS Tool (Cleveland, Ohio) in December 2012 put us into a world leadership position in our niche, and added $23 million to the revenue line. The fact that this niche remains fragmented below us provides ongoing consolidation opportunity.
Were there any early signs that you would eventually follow an entrepreneurial path?
I'm not sure I consider myself an entrepreneur in at least the traditional sense. I do however consider myself a risk taker and have put substantial funds in to this and other businesses.
While I worked for 20-plus years as an employee in the corporate world, I have always wanted to strike out on my own or in partnership with a few others. I eventually did this in 2006/7, at age 43, paying my own salary and paying transaction costs on a number of deals, many of which we didn’t get over the line.
