FIN 461 (Financial
Modelling) BURTON
SENSORS CASE
SYRACUSE UNIVERSITY
, Burton Sensors, Inc.
In February 2017, Amy Marshall, president of Burton Sensors, Inc. (Burton), located in
Fort Wayne, Indiana, met with the company’s financial consultant to discuss three key issues:
• Should Burton purchase new thermowell machines?
• Should Burton raise additional capital through a private placement?
• Should Burton acquire Electro-Engineering, Inc., which manufactures 昀椀ber-optic
sensors?
Company Background
Burton was engaged primarily in the design and manufacturing of temperature
sensors. Its products included a variety of highly accurate standard and customized
thermocouple sensors, resistance temperature detectors (RTDs), and bearing
temperature probes, as well as temperature transmitters. Its end users covered a wide
range of industries, including oil and gas, petrochemicals, industrial machinery,
automotive, food processing, medical, and aerospace.
While majoring in mechanical engineering, Marshall became interested in sensor
technology. Shortly after her graduation in 2002, she founded AMI Labs with a loan from
her family and began supplying temperature sensors to several local food processors. To
meet growing demand, she acquired Burton Sensors in 2004 and adopted the target
昀椀rm’s name for the combined enterprise.
Initially, Burton 昀椀nanced its growth primarily through internally generated cash flow s; however,
Marshall saw that Burton needed more funds than it could generate internally to 昀 椀
nance growth opportunities. Consequently, Burton had an initial public offering in 2011.
Shortly after the equity issuance, Marshall realized that Burton needed yet more 昀 椀
nancing to expand even further. She approached her bank to request a substantial
increase in Burton’s line of credit in 2013. Exhibits 1, 2, and 3 show Burton’s balance
sheet, income statement, and statement of cash flow s, respectively.
918-539 | Burton Sensors, Inc.
Modelling) BURTON
SENSORS CASE
SYRACUSE UNIVERSITY
, Burton Sensors, Inc.
In February 2017, Amy Marshall, president of Burton Sensors, Inc. (Burton), located in
Fort Wayne, Indiana, met with the company’s financial consultant to discuss three key issues:
• Should Burton purchase new thermowell machines?
• Should Burton raise additional capital through a private placement?
• Should Burton acquire Electro-Engineering, Inc., which manufactures 昀椀ber-optic
sensors?
Company Background
Burton was engaged primarily in the design and manufacturing of temperature
sensors. Its products included a variety of highly accurate standard and customized
thermocouple sensors, resistance temperature detectors (RTDs), and bearing
temperature probes, as well as temperature transmitters. Its end users covered a wide
range of industries, including oil and gas, petrochemicals, industrial machinery,
automotive, food processing, medical, and aerospace.
While majoring in mechanical engineering, Marshall became interested in sensor
technology. Shortly after her graduation in 2002, she founded AMI Labs with a loan from
her family and began supplying temperature sensors to several local food processors. To
meet growing demand, she acquired Burton Sensors in 2004 and adopted the target
昀椀rm’s name for the combined enterprise.
Initially, Burton 昀椀nanced its growth primarily through internally generated cash flow s; however,
Marshall saw that Burton needed more funds than it could generate internally to 昀 椀
nance growth opportunities. Consequently, Burton had an initial public offering in 2011.
Shortly after the equity issuance, Marshall realized that Burton needed yet more 昀 椀
nancing to expand even further. She approached her bank to request a substantial
increase in Burton’s line of credit in 2013. Exhibits 1, 2, and 3 show Burton’s balance
sheet, income statement, and statement of cash flow s, respectively.
918-539 | Burton Sensors, Inc.
