Considering the situation that Paragon Tool is currently in, with uncertainty regarding company’s future, management in disagreement and the lack of tangible information regarding MonitoRobotic’s acquisition it is recommended that Paragon Tool, take a week, gather all of senior management and develop a concrete and agreed upon strategy regarding Paragon Tool’s future growth strategy. Once such a strategy is formulated, if the service business and MonitoRobotic’s fit with these plans, then Nickolas should take the next step in conducting the necessary due diligence to determine that the MonitoRobotic acquisition price and it’s culture will fit with Paragon Tools.
While Paragon Tool Company seems to be a healthy machine tool manufacturing company surviving in a tough industry, a primary concern for Nickolas Anaptyxi, CEO, is continued growth for the company. Paragon’s current tool manufacturing line is surviving in a fairly saturated market, but not exactly thriving. Mr. Anaptyxi’s primary goal since his start at Paragon is to grow the then small company through acquisitions.
The company continues to fund more and more acquisitions while continuing to show diminished profits. While the CFO continues to debate with the CEO, Nick Anaptyxi, Mr. Anaptyxi’s strategy continues to be growth for Paragon through frequent acquisitions while continuing to show poor margins to investors. His belief is that the cost now will pay off in the future.
The current situation that Paragon faces is that the recently added line of business of services (repairs, service calls, etc.) has been experiencing losses which has been pulling down its previously well performing tool manufacturing line. Mr. Anaptyxi believed that a key way for this slow growing and cyclical company to grow and thrive in the difficult market is to expand its market base by offering a service line to complement its tooling business. The CEO has to explain to...