October 3, 2012
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Archives for October 3, 2012

Flexpoint Forms New Platform to Acquire Dialysis Clinics, Closes First Transaction

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Corva, a new platform company formed by private equity firm Flexpoint Ford and Jerry Simonsen to acquire, develop and operate dialysis clinics, has signed an agreement to acquire the assets of Innovative Renal Care.

“We are excited to partner with Jerry to build an industry-leading dialysis company focused on delivering clinically superior treatments to patients,” said Ethan Budin, a Senior Principal at Flexpoint Ford. “We believe Jerry’s combination of industry expertise and operational experience makes him an ideal partner as Flexpoint Ford commits to a platform in the dialysis industry.”

Innovative Renal Care is located in Houston and currently serves approximately 100 patients with end stage renal disease. Corva will continue to acquire independent dialysis clinics, develop de novo clinics in partnership with nephrologists and seek other opportunities to integrate all dialysis services throughout North America. The company is based in Greenwood Village, CO (www.corvaclinics.com).

Flexpoint Ford plans to invest up to $75 million of equity capital to support Corva’s strategy. Mr. Simonsen, the former CEO of Renal Management, which was acquired by Gambro Healthcare, will serve as Chief Executive Officer of Corva.

“I am thrilled about the opportunity to build a significant dialysis company and excited to begin the process in the Southeast,” said Mr. Simonsen. “The Principals at Flexpoint Ford have a long history of backing experienced managers and providing them with the resources and support required to build successful companies through both organic growth and acquisitions. Flexpoint Ford’s very successful track record with other healthcare services companies makes them the ideal partner for Corva.”

Flexpoint Ford seeks to invest from $10 to $100 million in companies operating in the healthcare and financial services sectors. Flexpoint Ford currently has $1 billion in capital under management. The firm is based in Chicago, IL with an additional office in New York, NY (www.flexpointford.com).

“We are enthusiastic about the IRC acquisition and the larger opportunity to build a high-quality business in the dialysis sector,” said Perry Ballard, a Principal at Flexpoint Ford. “We are actively looking for acquisitions and see a number of compelling investment opportunities in the market today.”

© 2012 PEPD • Private Equity’s Leading News Magazine • 10-3-12

Bedford Funding Raises New $1 Billion Fund

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Bedford Funding, a private equity firm specializing in information technology investment opportunities in the Human Capital Management and Healthcare IT markets, has raised $1 billion for its second fund, Bedford Funding II.

“The fragmented and rapidly consolidating IT marketplace continues to offer attractive special situation opportunities, and, we believe, our investment strategy and longer-term operating business mindset enable us to address the niche investment and improvement opportunities abundant in the software sector,” said Charles Jones, Managing Partner of Bedford Funding. “In particular, we see ever-increasing innovation in the Healthcare Information Technology marketplace and are delighted that our investors have so strongly supported our investment strategy and initial targets for this fast-growing market segment with a$1 billion endorsement. No place in business is there more need to reduce costs while improving quality of delivery.”

Under the direction of Mr. Jones, Bedford Funding has expanded its investment, financial and analyst teams to accommodate the additional fund. Mr. Jones has held a range of leadership positions as a financial advisor, executive operator and investor, including executing a global industry roll-up for a U.K.-based public relations firm, completing sixty middle-market corporate finance transactions in varying industries and having notable success as Chairman and CEO of Geac, where he created shareholder value as the stock price appreciated from $1.12 in April of 2001 to $11.10 in March of 2006, when he led the sale of the company for $1 billion.

Bedford Funding is a private equity firm providing long-term capital to businesses in the consolidating and fragmented technology industry with a focus in the software and IT services sectors. Bedford Funding was founded in 2006 with the launch of its initial $400 million fund- Bedford Funding I- and recently raised Bedford Funding II. Bedford Funding is headquartered in White Plains, NY (www.bedfordfunding.com).

© 2012 PEPD • Private Equity’s Leading News Magazine • 10-3-12

CID Capital Exits GT Exhaust

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GT Exhaust, a provider of sound and emissions control products and a portfolio company of CID Capital, has been sold to Industrial Acoustics Company, a portfolio company of AEA Investors.

GT Exhaust is a provider of sound and emissions control products to the North American energy, power and heavy transportation industries. The company’s product line, which includes silencers, catalytic converters, diesel particulate filters and related accessories, is used in new installation and retrofit applications for large stationary engines. The company was founded in 1978 and is Lincoln, NE (www.gtexhaust.com).

CID Capital makes majority investments in lower-middle-market companies that have revenues of $10 million to $ 75 million and an EBITDA of at least $2 million. Sectors of interest include industrial manufacturing; proprietary education; branded consumer products; safety and security products; specialty food manufacturing and distribution; value-added distribution and logistics; medical devices and healthcare services. The firm is base in Indianapolis, IN (www.cidcap.com).

Industrial Acoustics Company is a global provider of engineered noise and acoustic control products to various industries, including energy & power, industrial, commercial construction, aviation, and automotive end markets. The company is based in Winchester, UK (www.industrialacoustics.com).

AEA manages approximately $5 billion of invested and committed capital in funds dedicated to three purposes: buyouts of middle market companies operating principally in four sectors – industrial, specialty chemical, consumer products and services; buyouts of smaller middle market companies in these same sectors; and mezzanine and senior debt investments. AEA is based in New York, NY (www.aeainvestors.com).

Lincoln International acted as the exclusive financial advisor to GT Exhaust, working closely with the company’s senior management team and CID Capital throughout the sale process. This included providing advisory expertise and managing the marketing, negotiation and due diligence phases of the transaction.

“Through an aggressive, global marketing effort and unique insights into the buyer universe, drawn from several prior transactions in the exhaust and emissions space, Lincoln created a highly competitive process resulting in attractive alternatives for the shareholders with a very favorable outcome. Lincoln’s execution expertise, industry knowledge, and process guidance proved invaluable throughout the sale process,” said Scot Swenberg, Managing Director at CID Capital.

Lincoln International specializes in merger and acquisition advisory services, debt advisory services, private capital raising and restructuring advice on mid-market transactions. Lincoln International also provides fairness opinions, valuations and pension advisory services on a wide range of transaction sizes. With thirteen offices in the Americas, Asia and Europe, Lincoln International has strong local knowledge and contacts in key global economies. The firm provides clients with senior-level attention, in-depth industry expertise and integrated resources. The firm is based in Chicago, IL (www.lincolninternational.com).

© 2012 PEPD • Private Equity’s Leading News Magazine • 10-3-12

Platinum Equity Acquires BWAY

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BWAY Corporation, a supplier of general line rigid containers and a portfolio company of Madison Dearborn Partners, has entered into an agreement to be acquired by Platinum Equity in a transaction valued at approximately $1.2 billion. Senior executives of the BWAY and a number of other employees will invest in the transaction alongside Platinum.

The acquisition will be financed through a combination of equity contributed by Platinum Equity along with certain members of management, and committed debt financing provided by Bank of America Merrill Lynch and Deutsche Bank. The transaction is expected to close in the fourth quarter of 2012.

“BWAY is a world class packaging business with strong customer relationships and a proven management team,” said Louis Samson, the Partner at Platinum Equity whose team led the acquisition. “We are excited to bring our operational capabilities to bear and to partner with the company’s management team to build on BWAY’s strong fundamentals.”

BWAY is a manufacturer and distributor of metal and rigid plastic containers that are used primarily for packaging of industrial and consumer products. Products include aerosol cans, ammunition boxes, cone and pour top cans, metal paint cans, oil cans, and plastic drums. The company operates 22 plants throughout the United States and Canada and is based in Atlanta, GA (www.bwaycorp.com).

“We are very excited about this transaction with Platinum Equity. Platinum brings to BWAY a strong operational and strategic focus and a tremendous track record of value creation that we are convinced will help us achieve new levels of success,” said Ken Roessler, BWAY’s President and Chief Executive Officer. “We look forward to taking the next step in the evolution of our company.”

Goldman, Sachs & Co., Barclays and Deutsche Bank Securities acted as financial advisors to BWAY and Kirkland & Ellis was the company’s legal advisor. Latham & Watkins acted as legal advisor to Platinum Equity.

Platinum Equity invests in a range of industries including information technology, telecommunications, logistics, metals services, manufacturing and distribution. Platinum Equity has completed nearly 120 acquisitions with more than $27.5 billion in aggregate annual revenue at the time of acquisition. The firm is based in Beverly Hills, CA and also has offices in New York, NY and London, UK (www.platinumequity.com).

Madison Dearborn Partners has more than $18 billion of capital under management and makes new investments through its most recent funds, Madison Dearborn Capital Partners V and Madison Dearborn Capital Partners VI. Madison Dearborn invests in businesses across a spectrum of industries including basic industries; business and government services; consumer; financial services; health care; and telecom, media and technology services. The firm was founded in 1992 and is based in Chicago, IL (www.mdcp.com).

© 2012 PEPD • Private Equity’s Leading News Magazine • 10-3-12

Freestone Partners Exits Sunbelt Steel

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Sunbelt Steel Texas, a portfolio company of Freestone Partners and a distributor of specialty alloy steel bar and heavy-wall tubing products, has been sold to Reliance Steel & Aluminum Co.  Sunbelt will operate as a wholly-owned subsidiary of Reliance Steel and Aluminum. Current management will remain in place with Michael Kowalski continuing as President of Sunbelt.

Sunbelt is a value added distributors of specialty alloy steel bar and heavy-wall tubing products to the oil and gas industry. Sunbelt was founded in 1986 and is based in Houston with additional locations in Salt Lake City, UT; Dallas, TX and Alberta, Canada (www.sunbeltsteel.com).

Reliance Steel & Aluminum (NYSE: RS) is one of the largest metals service center companies in North America. The company provides value-added metals processing services and distributes a full line of over 100,000 metal products to more than 125,000 customers in a range of industries. Reliance Steel & Aluminum has a network of more than 220 locations in 38 states and Australia, Belgium, Canada, China, Malaysia, Mexico, Singapore, South Korea, the UAE and the United Kingdom and is headquartered in Los Angeles (www.rsac.com).

“We are excited to add Sunbelt Steel Texas to the Reliance Family of Companies. Sunbelt increases our growing exposure to the energy market in high end, niche products serving customers across multiple oil and gas well drilling types, including vertical, horizontal, directional, and deepwater drilling applications,” said David Hannah, Chairman and CEO of Reliance Steel & Aluminum Co. “Sunbelt’s in-house processing services include deep hole drilling, straightening, and saw cutting with the ability to manufacture heavy-wall tubing from solid bar. We look forward to continuing Sunbelt’s growing presence in their specialty markets.”

Quarton Partners acted as the exclusive advisor to Sunbelt Steel and Freestone. Quarton Partners is a specialty investment banking firm serving privately held and publicly traded companies as well as private equity firms. Quarton assists its clients with mergers and acquisitions, private capital raising, restructurings, valuations, and other financial advisory services. The firm’s principals have successfully completed hundreds of engagements in a wide variety of industries across the US and throughout the world. Quarton Partners is a division of Leonard & Company, Michigan’s largest independent broker/dealer. The firm is headquartered in Birmingham, MI (www.quartonpartners.com).

© 2012 PEPD • Private Equity’s Leading News Magazine • 10-3-12

GTCR Acquires OneSource

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Infogroup, a provider of data and multichannel marketing services has sold its OneSource business to Cannondale Investments, a GTCR platform company focused on acquiring data‐enabled information services companies.

OneSource provides business and sales data on millions of companies and executives worldwide to optimize clients’ sales and marketing efforts and assisting with business-to-business research activities.

The company serves technology, software, business and financial services, consulting, and recruitment sectors. OneSource was formerly known as Lotus OneSource and changed its name in 1993. The company’s services are delivered through the Web, CRM integrations, and information portals. OneSource was founded in 1986 and has offices in North America, Europe, Australia, and Asia and is headquartered in Concord, MA (www.onesource.com).

Cannondale Investments was formed by GTCR in July 2011 to acquire data‐enabled information services companies. The company is led by Joseph Ripp and is based in Wilton, CT (www.cannondaleinvestments.com).

GTCR pioneered the investment strategy of identifying and partnering with executives to acquire and build companies through a combination of acquisitions and internal growth. The firm currently has nearly $7 billion in assets under management. Since its inception, GTCR has invested more than $8.5 billion in over 200 companies. The firm was founded in 1980 and is located in Chicago, IL (www.gtcr.com).

Infogroup helps companies increase sales and customer loyalty through its data and multi‐channel digital and offline marketing services. Customers include local businesses to Fortune 100 companies. Infogroup is based in Omaha, NE (www.infogroup.com).

“Infogroup continues to focus on delivering the highest quality data products and services to third parties, leveraging our proprietary data sets,” said Michael Iaccarino, Chairman and CEO, Infogroup. “This sale helps create strategic efficiencies for us as we continue in this direction, while also positioning OneSource for an excellent future with Cannondale Investments.”

The Jordan, Edmiston Group (JEGI), an investment bank for the media, information, marketing, and technology sectors, represented Infogroup in this transaction and acted as its exclusive financial advisor. JEGI is based in New York (www.jegi.com).

© 2012 PEPD • Private Equity’s Leading News Magazine • 10-3-12

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