Archives for November 2012

U.S. Private Equity Firms Facing Competition from Global Markets in Capital and Acquisitions

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Private equity firms in the United States are facing increased competition from foreign and international firms for investment opportunities within the U.S. market, according to the 2012 Global Private Equity Report by Grant Thornton International.  A link to a free copy of this report is available at the end of the article.

Now in its second year, Grant Thornton’s report is the result of 143 in-depth interviews with senior private equity practitioners around the globe. It provides insight into private equity general partners’ expectations for numerous aspects of the fundraising and investment cycle during the next 12-36 months.

According to the survey, North America is among the top three regions for investment by private equity firms in the next two to four years, with 76 percent of respondents identifying it as such.  In addition, 91 percent said they would be investing in the MENA (Middle East North Africa) region, while 71 percent identified the BRIC (Brazil, Russia, India, China) countries as an investment opportunity.

Similarly, the survey shows that 43 percent of respondents plan to open an office in North America in the next two to three years, while 40 percent said the same about MENA, and 28 percent plan to do so in the BRIC countries.

In fact, regarding the strongest competition for deals in the next 12 months, 18 percent of North American respondents cited foreign/international private equity firms, far more than the 31 percent attributed to trade buyers.

When asked if they expected the level of investment in their region to increase, decrease, or stay the same, nearly 60 percent of respondents in North America said “increase,” compared to 60 percent of those in MENA and nearly 40 percent of those in the BRICs.

“North America, and the United States specifically, is a far more mature investment market than others around the world, so it’s not surprising that there is increased interest from global PE firms to invest here,” said Carlos Ferreira, a partner in Transaction Advisory Services of Grant Thornton. “PE firms here have to realize that they’re not the only ones invited to the show—they are going to have to figure out a way to thrive despite this growing competition from foreign investment firms.”

With a global economy that has been hampered by European debt crises and U.S. recessions, it’s not surprising that respondents are still cautious about the fundraising environment.  In fact, 20 percent of respondents in North America described their outlook about the current fundraising environment as positive. It was actually the most optimistic region, with only respondents in MENA coming close. Of the other regions, 6 percent of Asia-Pacific respondents, 9 percent of European respondents, and 8 percent of those in the BRIC described their outlook as positive.

One thing North American respondents are not as optimistic about is the perception of the private equity industry overall. Nearly 65 percent of respondents believe the image of the industry is deteriorating, far more than their global counterparts. In fact, in the MENA region, more than 50 percent of respondents believe the image of the industry is improving, likely because it is still a burgeoning industry. Even so, image is not a concern for respondents around the world. Instead, they consider the biggest challenges to be regulation (34 percent), macro economy (34 percent), competition (24 percent), and fundraising/IR (20 percent).

“From a global standpoint, this is an interesting time for the PE industry,” said Mr. Ferreira. “There are global markets that are emerging as serious players in the game. Yet, there is still plenty of opportunity for U.S. PE firms to make the right investments and be successful.”

To download a free copy of the 2012 Global Private Equity Report click HERE.

http://www.gti.org/files/global_private_equity_report_2012.pdf

© 2012 PEPD • Private Equity’s Leading News Magazine • 11-30-12

Babson Capital Backs River Capital’s Investment in Blue Wave Products

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Babson Capital Management has provided a combination of senior debt, subordinated debt and equity to support River Capital’s purchase of Blue Wave Products, a specialty distributor of swimming pools and pool-related products.  Babson Capital served as the sole provider of senior and subordinated debt on the transaction.

“As a reliable partner on eight portfolio investments spanning more than 25 years, Babson Capital consistently provides River Capital with a combination of experience and service that is difficult to match,” said Jerry Wethington, Managing Principal of River Capital. “River Capital looks forward to working with the Babson Capital team on Blue Wave and other investment opportunities going forward.”

Blue Wave is a specialty distributor of recreational products, including swimming pools and pool-related products, serving the internet retail marketplace. The company’s customer base includes both large national retailers as well as internet retail dealers.  Blue Wave functions as a one-stop shop for wholesale recreational products, offering more than 6,000 SKUs, including both national brands and Blue Wave branded products.  Its primary products include above-ground pools, automatic cleaners, steps and ladders, winter products, games, and saunas. The company specializes in the inventory management of large, bulky products, direct-to-consumer fulfillment, product sourcing, and marketing services on behalf of its customers.  The company is based in Saint Charles, IL (www.splashnetxpress.com).

“Babson Capital’s partnership-oriented approach to investing in the middle market is exemplified by our longstanding and valued relationship with River Capital,” said Mike Klofas, Managing Director and head of Babson Capital’s Mezzanine & Private Equity Group. “Blue Wave has built a leadership position in a niche market with its broad product offering, quick turnaround times, and strong customer service, and we are excited about its growth potential as it benefits from the operating experience of River Capital.”

Babson Capital had $154 billion in assets under management as of September 30, 2012 and is a member of the MassMutual Financial Group. The firm is based in Boston and Springfield, MA and Charlotte, NC and has six additional offices in the US and one in Sydney, Australia, with subsidiaries in London and Tokyo (www.BabsonCapital.com).

River Capital invests from $3 million to $7 million of equity in companies in the light manufacturing, distribution and service industries that have revenues of at least $10 million.  Typical transactions sizes range from $10 million to $50 million.  The firm is based in Atlanta, GA (www.river-capital.com).

© 2012 PEPD • Private Equity’s Leading News Magazine • 11-30-12

Dresner Partners Advised ChemDesign on Sale to Lubar & Co.

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Dresner Partners was the advisor to ChemDesign Products, a portfolio company of Resilience Capital Partners, on its recent sale to Lubar & Co.

“On behalf of the ChemDesign management team, we were impressed by Dresner Partners’ understanding of our business and the industry.  Omar Diaz and Paul Hoffman both understood the transition our business went through under Resilience’s ownership and the value this created for the future,” said David Mielke, President and Chief Executive Officer of ChemDesign.  “Within an aggressive timeframe, the Dresner team was able to boil down the process to a handful of seriously interested parties. Not only was the deal a success for Resilience, but also for ChemDesign. This was a win-win for all parties involved. Resilience sold a great business, and ChemDesign acquired a great partner with Lubar.  Dresner made that happen within the exact timeline they presented.”

ChemDesign is a provider of toll manufacturing services to the global chemical industry.  Toll manufacturers provide a processing or manufacturing service on a customer’s product for a fee or toll.  ChemDesign has expertise in low pressure hydrogenations, condensation chemistry, multi-step synthesis, methylations and serves the agricultural chemicals, consumer, energy, industrial and plastics industries. Many large chemical companies are increasingly turning to domestic toll processors, such as ChemDesign, to drive potential cost savings, reduce internal assets, and allow them to shift their focus toward research and development and away from non-core processes.  ChemDesign was founded in 1982 and is based in Marinette, WI (www.chemdesign.com).

“This transaction is another example of Dresner’s ability to create value by managing aggressive, well-run transaction processes on behalf of our clients.  We were honored to work with the well-respected organizations of ChemDesign, Resilience Capital Partners and Lubar & Co.,” said Steven Dresner, President at Dresner Partners.

Dresner Partners is a middle-market investment bank headquartered in Chicago with offices in New York, Connecticut and Los Angeles.  Founded in 1991, Dresner Partners provides financial advisory services to business owners and managers, including institutional private placements of debt and equity, merger and acquisitions, valuations and strategic consulting services. Sectors of interest include consumer, food, healthcare, technology, education, financial services and industrials (www.dresnerpartners.com).

“The Dresner team did a great job in orchestrating the entire sale process. Their attention to detail and understanding of the salient business issues enabled us to maximize value for our shareholders,” said Ki Mixon, Partner of Resilience Capital Partners.

Resilience Capital Partners specializes in investing in lower middle market companies across a range of industries.  Resilience’s investment strategy is to acquire companies in a variety of special situations including underperformers, corporate divestitures, turnarounds, and orphan public companies. Since its inception in 2001, Resilience has acquired 27 companies under 19 platforms with over $2.5 billion in revenue. The firm is based in Cleveland, OH (www.resiliencecapital.com).

“It was our privilege to work with Bassem Mansour and Ki Mixon of Resilience Capital and Dave Mielke and the rest of the outstanding management team at ChemDesign,” said Omar Diaz, Managing Director at Dresner Partners. “ChemDesign’s revitalized business model, position in the global chemical supply chain and strong relationships with many of the leading players in the chemical industry made it an attractive, highly sought after target.  We leveraged our extensive chemical industry experience and relationships with both strategic and private equity buyers to help generate this outstanding outcome for Resilience and ChemDesign.”

© 2012 PEPD • Private Equity’s Leading News Magazine • 11-30-12

ShoreView Acquires Tex Tech Industries

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Private equity firm ShoreView Industries has acquired Tex Tech Industries, a developer and manufacturer of high performance materials and products.

Yukon Partners supported this acquisition with a mezzanine debt and equity co-investment in Tex Tech.  “We are very excited to partner with Yukon on Tex Tech. They brought relevant end market expertise and were very responsive throughout the closing process,” said Thomas D’Ovidio, Partner at ShoreView.

Tex Tech develops and manufactures over 1,500 engineered, high performance materials and products for niche applications. The company’s products include ballistic materials for soft body armor; fire blocking, thermal, and insulation used in aircraft; high temperature filtration applications used in the power plant, cement, and asphalt industries; and tennis felt used in tennis balls. The company serves a base of over 400 customers across a number of markets including aerospace, law enforcement and military, filtration, sporting goods, and industrial. Tex Tech was founded in 1904 and is headquartered in Portland, ME (www.textechindustries.com).

Yukon Partners is a mezzanine finance firm dedicated to serving middle market private equity sponsored business transactions with a typical investment range of $10 to $40 million.  The transactions in which Yukon invests include buyouts, growth and platform strategies, recapitalizations, mergers/acquisitions, public to private buyouts, and refinancings.  The firm is based in Minneapolis (www.yukonpartners.com).

“Tex Tech has unique manufacturing capabilities and we believe the company is well positioned to make further inroads in the diverse end markets it already serves, said William Dietz, Managing Partner at Yukon.  “ShoreView’s value-added operating expertise coupled with management’s experience will provide a foundation for continued success.  We are excited to have this opportunity to partner with ShoreView.”

ShoreView Industries invests in US based middle market companies across a range of industries with revenues ranging between $20 million and $300 million. The firm currently has $600 million of capital under management and is based in Minneapolis (www.shoreviewindustries.com).

© 2012 PEPD • Private Equity’s Leading News Magazine • 11-30-12

Corinthian Capital Acquires Friedrich Air Conditioning

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Corinthian Capital Group has acquired Friedrich Air Conditioning, a manufacturer of room air conditioners.

“We are excited about this new partnership with Corinthian Capital,” said Chuck Campbell, Chief Executive Officer of Friedrich. “Working together with the Corinthian team, I believe we can strengthen our competitive advantage and achieve robust growth.”

Friedrich Air Conditioning is a manufacturer of room air conditioners.  The company was founded in 1883 and is headquartered in San Antonio with a manufacturing facility in Monterrey, Mexico (www.friedrich.com).

“Corinthian is pleased to partner with Friedrich and its impressive management team to help launch the company into its next stage of strategic growth and development,” said Peter Van Raalte, Senior Managing Director of Corinthian Capital.

Financing for the transaction was provided by Regions Business Capital and Kayne Anderson Mezzanine Partners.  Affiliates of Kayne Anderson Mezzanine Partners and senior management of Friedrich Air Conditioning made a minority equity investment in the company.  McGladrey provided accounting advice to Corinthian Capital in the transaction.  Friedrich Air Conditioning was advised by Capstone Partners.

Corinthian Capital invests in niche manufacturing, distribution, and service businesses with EBITDAs between $5 million and $30 million located primarily in North America. Corinthian Capital is based in New York with offices located in Chicago and Boston (www.corinthiancap.com).

© 2012 PEPD • Private Equity’s Leading News Magazine • 11-30-12

Saw Mill Capital Acquires Victory Energy Operations

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Saw Mill Capital Partners has acquired Victory Energy Operations, a manufacturer of fired packaged boilers.  Saw Mill partnered with John Viskup, President and Chief Executive Officer of Victory Energy Operations, on this transaction.

“We are very excited to consummate a partnership where we bring important resources to the table that will have a long-lasting impact on the development of Victory.  This new partnership will unlock opportunities for continued growth into new products and end markets, and expand Victory’s horizon to a global scale,” said Tim Nelson, Principal at Saw Mill Capital.

Victory Energy Operations designs, engineers, manufactures and services fired packaged boilers, waste heat boilers, and heat recovery steam generators and related equipment utilized in a variety of industrial and institutional end markets, including power generation, bio-renewable, oil sands, petrochemical, district heating, education and healthcare.  The company manufactures from its two locations in Collinsville (headquarters) and Cushing, OK (www.victoryenergy.com).

As part of this transaction, Larry Edwards, the former President, CEO and Chairman of Global Power Equipment Group, has agreed to join the Board of Directors of Victory.  Global Power was a former portfolio company of Saw Mill, and under Mr. Edward’s leadership, the business more than quintupled in size and expanded internationally.  He has agreed to assist the Victory team with its strategic direction, business development and international expansion activities.

“I am thrilled to continue the exceptional growth Victory has enjoyed with a strategic partner that will bring not only fresh capital in support of our programs but also new resources that will accelerate our growth,” said Mr. Viskup.

Saw Mill Capital invests in manufacturing and service companies with enterprise values of $25 million to $200 million. Platform investments typically have at least $5 million of EBITDA and revenues of $40 million to $150 million. The firm is located in Briarcliff Manor, NY (www.sawmillcapital.com).

GulfStar Group, a middle-market investment bank based in Houston, served as Victory’s exclusive financial advisor and, through its merchant banking affiliate, invested in the transaction.

© 2012 PEPD • Private Equity’s Leading News Magazine • 11-30-12

Carrick Capital Partners Closes First Fund at $180 Million

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Carrick Capital Partners has held the final close of its first fund with $180 million in capital commitments.  The fund will invest in companies that focus on technology-enabled service offerings, business process outsourcing, transaction processing, software as a service and enterprise software.

Carrick Capital Partners was co-founded by Marc McMorris, a former General Atlantic managing director who led investments in business services and software, and Jim Madden, the previous founder and chief executive of Exult, a human resources business processing company that he grew from concept to more than $500 million in revenues.

Carrick Capital Partners takes an operational approach to growth equity investing, bringing to bear a combination of operational and investment expertise to help entrepreneurs and management successfully scale their businesses.  “We are very pleased by the response to this fund. It underscores the market’s appreciation of our investment strategy and approach – helping good companies scale and achieve even greater success,” said Mr. McMorris.

“Carrick Capital Partners seeks to invest in companies that possess the right fundamentals to significantly grow their operations,” said Mr. Madden.  “We will leverage our experience building and actively investing in fast growing businesses to work closely with CEOs and founders.”

Carrick Capital Partners invests in companies with revenues of $5 million to $ 50 million that serve large markets with business models that allow for increasing profitability as they gain scale.  The firm was founded in 2012 and is based in San Francisco (www.carrickcapitalpartners.com).

© 2012 PEPD • Private Equity’s Leading News Magazine • 11-28-12

L2 Capital Adds Two New Professionals

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L2 Capital Partners has added two new team members to its staff with the hiring of Matt Klein as an Operating Partner and Connor McMahan as an Associate.

“It is very exciting to have Matt and Connor join our team. Both are highly talented and greatly expand L2’s ability to enhance the performance of our existing portfolio as well as to execute acquisitions of new platform companies and add-on opportunities for our portfolio companies,” said Bob Levine, Managing Partner of L2 Capital.

Mr. Klein brings more than fifteen years of experience in strategy, finance and operations at lower middle market firms. His primary focus is to promote growth and value creation activities at L2 Capital’s portfolio companies. Prior to joining L2 Capital, Mr. Klein spent more than fifteen years as an entrepreneur, consultant and interim executive for client companies in the services, logistics, manufacturing, consumer goods, real estate and construction industries. He previously was a Director at both KPMG and Alvarez & Marsal, where he worked on performance improvement, transactions and restructuring engagements.  Mr. Klein holds a BS degree from California Polytechnic University and an MBA degree from the University of Texas.

Mr. McMahan joins L2 Capital from Boxwood Partners, a merchant bank in Richmond, VA, where he was an Associate. While at Boxwood, he executed lower middle market transactions in a variety of industries for both the firm’s private equity and investment banking divisions. His primary focus is to source, analyze and monitor new investment opportunities and to provide analytical support for L2 Capital’s portfolio companies. Mr. McMahan earned a BS degree in Business Administration from the University of Richmond.

L2 Capital Partners invests in privately-owned manufacturing, service and distribution companies with revenues of $10 million to $75 million and valuations of up to $50 million. L2 Capital has over $50 million in available capital and invests from $1 million to $10 million in each transaction. L2 Capital is headquartered in Radnor, PA (www.L2Capital.net).

© 2012 PEPD • Private Equity’s Leading News Magazine • 11-28-12

Oxford Provides Backs Nursing Facility Operator

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Oxford Finance has closed a $20 million senior secured term loan and a $1.5 million revolving line of credit with Pali Corporation, a nursing facility operator.  Proceeds of the loan are being used to refinance the company’s existing debt and for working capital to support its two nursing facilities in Hawaii.

“Oxford is very pleased to provide capital to support the ongoing operations of Pali’s facilities,” said Christopher Herr, managing director for Oxford Finance. “Pali has a committed and experienced management team that is highly regarded in the healthcare community and for more than 25 years its two Honolulu facilities have been providing excellent care to its patients.”

Pali Corporation operates two skilled nursing facilities in Honolulu, HI. They have been operating for more than 25 years, providing short-term rehab and long-term care for the elderly (no website found).

“I am very grateful for Oxford and the help they can provide us,” said Dr. Edison Miyawaki, president of Pali Corporation. “It has been a pleasure working with them and I’m sure we will continue to have an outstanding relationship in the coming years.”

Oxford Finance, a subsidiary of Sumitomo Corporation, is a specialty finance firm providing senior secured loans to public and private life science and healthcare services companies worldwide. In recent years, Oxford has originated over $1.5 billion in loans, with lines of credit ranging from $500,000 to $50 million. Oxford is headquartered in Alexandria, VA with additional offices in California, Massachusetts and North Carolina (www.oxfordfinance.com).

© 2012 PEPD • Private Equity’s Leading News Magazine • 11-28-12

Resilience Capital Partners Exits ChemDesign

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Resilience Capital Partners has sold its portfolio company ChemDesign, a provider of toll manufacturing services to the global chemical industry, to private equity firm Lubar & Co.  Resilience acquired ChemDesign in October 2006 in a Chapter 11 Section 363 bankruptcy sale.

The sale of ChemDesign generated a  3.8x net return on invested capital and a 25.9% net internal rate of return. “Our investment in ChemDesign is a great case study in corporate renewal. Through hard work, vision, and an operations oriented approach real value was created for the benefit of all the company’s stakeholders,” said Bassem Mansour, Co-CEO of Resilience.

ChemDesign is a provider of toll manufacturing services to the global chemical industry.  Toll manufacturers provide a processing or manufacturing service on a customer’s product for a fee or toll.  ChemDesign has expertise in low pressure hydrogenations, condensation chemistry, multi-step synthesis, methylations and serves the agricultural chemicals, consumer, energy, industrial and plastics industries. Many large chemical companies are increasingly turning to domestic toll processors, such as ChemDesign, to drive potential cost savings, reduce internal assets, and allow them to shift their focus toward research and development and away from non-core processes.  ChemDesign was founded in 1982 and is based in Marinette, WI (www.chemdesign.com).

“I am proud of our many accomplishments”, said David Mielke, ChemDesign’s CEO. “Resilience, as a partner, has been critical to our success by providing the capital structure at the onset and supporting the management team through a dynamic transition in an unpredictable economic climate. I have found the working relationship and support between the management team and Resilience unique and refreshing. They balance high standards of performance with a true understanding of the business and its capabilities.”

Resilience Capital Partners specializes in investing in lower middle market companies across a range of industries.  Resilience’s investment strategy is to acquire companies in a variety of special situations including underperformers, corporate divestitures, turnarounds, and orphan public companies. Since its inception in 2001, Resilience has acquired 27 companies under 19 platforms with over $2.5 billion in revenue. The firm is based in Cleveland, OH (www.resiliencecapital.com).

Lubar & Co. invests in middle market companies located from the Great Lakes to Texas that have revenues of $30 million or more and EBITDA of $5 million to $30 million. Sectors of interest include niche manufacturing; business services; energy; food; architecture, engineering and construction; finance and asset management; healthcare; and banking. The firm is based in Milwaukee, WI (www.lubar.com).

“This is an exceptionally talented, knowledgeable and experienced organization and we look forward to a rewarding relationship with CEO Dave Mielke and the rest of the ChemDesign team,” said David Lubar. “The company is well positioned to grow and create long-term partnerships with current and new customers who are well suited to their capabilities.”

Jones Day served as legal counsel and Dresner Partners acted as exclusive financial advisor to ChemDesign and Resilience.

© 2012 PEPD • Private Equity’s Leading News Magazine • 11-28-12

Teachers’ Private Capital Acquires Plano Molding

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Ontario Teachers’ Pension Plan (Teachers’) has signed an agreement to acquire Plano Molding Company, a supplier of outdoor sports storage systems.  Teachers’ is making the acquisition through its private equity investment division, Teachers’ Private Capital.

“The Plano management team and I are extremely excited to be partnering with Teachers’,” said Tom Hurt, the company’s President and CEO. “Together we look forward to growing Plano’s heritage brands to their full potential and continuing our dedication to exceeding our customer expectations in product innovation, market leadership and world-class customer service.  An exciting new journey has just begun for Plano, our valued associates and the many market leading brands under our umbrella.  The Teachers’ partnership in Plano promises to yield more exciting opportunities than ever before.”

Plano manufactures tackle boxes, bait storage, gun cases, archery cases, and ice fishing products. It also produces cases for cosmetics, tools and crafts, as well as storage containers and shelving for home and office. The company was founded in 1932 and is based in Plano, IL (www.planomolding.com).

“Plano has exceptionally strong brands and product categories supported by attractive market characteristics. It also benefits from its long-standing relationships with top North American retailers,” said Jane Rowe, Senior Vice-President of Teachers’ Private Capital.  “Plano’s proven management team has a record of solid organic growth and has strongly positioned the company to benefit from acquisition opportunities. We look forward to supporting their success.”

Teachers’ Private Capital is one of the world’s largest private equity investors, having participated as a long-term investor in numerous management buyouts in Canada, the United States and Europe. It is the private investment department of the Ontario Teachers’ Pension Plan, the largest single-profession pension plan in Canada. Teachers’ Private Capital is based in Toronto with offices in New York and London (www.teachersprivatecapital.com).

© 2012 PEPD • Private Equity’s Leading News Magazine • 11-28-12

Leading Ridge Capital Partners Acquires F.W. Honerkamp

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Rugby Architectural Building Products, a portfolio company of Leading Ridge Capital Partners, has acquired F.W. Honerkamp Co., a distributor of architectural building products.

F.W. Honerkamp Co. distributes a full line of architectural wood products, decorative surfacing and cabinet hardware. The company was founded in 1871 and is based in New York (www.honerkamp.com).

The acquisition of F.W. Honerkamp Co. is Rugby’s tenth acquisition since 2010, through which the company has doubled its revenue and customer base and grown to 21 distribution centers across the country. “F.W. Honerkamp is an iconic franchise in one of the largest US markets for our products,” said David Hughes, Rugby President and CEO. “We are extremely excited to have the outstanding Honerkamp team become part of the Rugby organization.”

With the addition of Honerkamp’s Bronx, NY distribution center, Rugby will service the greater New York City metropolitan region from three locations situated in Northern New Jersey, Long Island and New York City. “New York City is the largest metropolitan area in the United States with a population base of 20 million,” said Drew Dickinson, Rugby COO.  “Metro New York has a particularly high density of companies in the woodworking industry, and having such strong distribution in this market will allow us to provide the highest levels of service to our customers.”

Rugby Architectural Building Products is a full-line wholesale distributor of specialty building products. Its primary business is the wholesale distribution of non-structural architectural grade building products sold principally to customers who supply end-products for the commercial, industrial, retail, residential and institutional markets. The company’s product offerings include hardwood plywood, composite panel products, solid surface countertops, high-pressure laminate, doors and millwork, hardwood lumber, cabinet hardware, moldings, Rugby brand sinks and faucets, and industrial wood coatings. Value-added services include custom color matching, laminated panels, cut-to-size panels, edge-banding, custom hardwood molding, hardwood lumber ripping and facing, and interior and exterior door pre-hanging. The company serves over 17,000 customers in the largest metro centers in the U.S. with a geographic footprint covering 30 states from 21 distribution facilities around the country. Rugby Architectural Building Products is headquartered in Concord, NH (www.rugbyabp.com).

Leading Ridge Capital Partners is a private equity firm specializing in acquisitions, recapitalizations, and investments in lower-middle market distribution, logistics, and light manufacturing companies with revenues between $10 million and $100 million. Target companies will have an EBITDA from $1 million to $5 million and will be located, generally, in the Mid-Atlantic region of the US. The firm has offices in Rockville, MD and New York, NY (www.leadingridge.com).

© 2012 PEPD • Private Equity’s Leading News Magazine • 11-28-12

Baird Invests in PARTNERS+simons

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Baird Capital Partners has made an investment in PARTNERS+simons, a brand communications company.

The investment by Baird Capital Partners will enable PARTNERS+simons to expand on its current services and build or acquire additional capabilities in public relations, direct-to-consumer marketing, data-driven analytics and CRM, social media, mobile and tablet applications, and patient engagement.

PARTNERS+simons is a brand communications company in the health, financial services and technology sectors.  Services include digital and traditional communications, paid and social media, rich media advertising (digital interactive media), mobile applications, direct mail, TV advertising, online video, widgets and social networking. The company was founded in 1989 and is based in Boston (www.partnersandsimons.com).

Baird Capital Partners invests in lower middle-market companies in the manufactured products, healthcare and business services sectors. The firm invests from $15 million to $35 million in companies with enterprise values of $25 million to $125 million and EBITDAs greater than $5 million. Baird Capital Partners was founded in 1989 and is based in Chicago, IL (www.bairdcapitalpartners.com).

© 2012 PEPD • Private Equity’s Leading News Magazine • 11-28-12

The Carlyle Group Raises New Energy Fund Above Target

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The Carlyle Group has raised a new $1.38 billion fund, Carlyle Energy Mezzanine Opportunities Fund (CEMOF), to invest in projects and companies in the power generation and energy sectors requiring capital of $20 million to $150 million per transaction. The fundraising effort exceeded Carlyle’s initial goal of $750 million.

“We are delighted with the faith investors have shown in us and in our strategy. CEMOF provides growth capital which is less dilutive and more flexible than that of traditional private equity. We enable owners to maintain control of their companies’ governance and to retain the bulk of the equity upside,” said David Albert, Managing Director and Co-head of the energy credit investment team.

The Carlyle Energy Mezzanine Opportunities Fund reflects Carlyle’s ongoing strategy of expanding its asset management business beyond the firm’s historical focus on control-oriented private equity. The fund resides within Carlyle’s Global Market Strategies segment, which comprises an array of structured credit, middle-market credit and distressed credit products, as well as hedge fund strategies (long/short credit; emerging markets equities; macroeconomic strategy; and commodities) – 55 funds with $30 billion in assets managed by 117 investment professionals in New York, Washington, DC, Los Angeles, Houston, Hong Kong and London as of September 30, 2012.

“We see strong opportunities in the market and have a great team based in New York and Houston to pursue them, as well as the Carlyle global network to assist in sourcing and supporting transactions,” said Rahul Culas, Managing Director and Co-head of the energy credit investment team. “The fund is off to a strong start having already made six investments in a mix of power generation projects and upstream and downstream energy companies.”

Carlyle Energy Mezzanine Opportunities Fund was advised by Simpson Thacher & Bartlett.

The Carlyle Group invests in buyouts, growth capital, real estate and leveraged finance in Africa, Asia, Australia, Europe, North America and South America focusing on aerospace & defense, automotive & transportation, consumer & retail, energy & power, financial services, healthcare, industrial, infrastructure, technology & business services and telecommunications & media. The Carlyle Group employs 1,300 people in 32 offices across six continents and is based in Washington, DC (www.carlyle.com).

© 2012 PEPD • Private Equity’s Leading News Magazine • 11-27-12

Jenner & Block Adds Mark Harris to Team

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Jenner & Block announced today that Mark Harris has joined the firm as a partner in the Chicago office.

Mr. Harris will join Jenner & Block’s Corporate Practice and become Co-Chair of the firm’s Private Equity Practice.  He will advise clients on acquisitions, divestitures, spin-offs, LBOs, going-private transactions, reorganizations, proxy contests and other complex transactions, as well as on corporate governance and other general business matters.

“We are very excited that Mark is joining the firm,” said Susan Levy, Managing Partner of Jenner & Block.  “Mark is well-known for his work in numerous areas, including private equity transactions.  He will be a tremendous asset to companies engaging in complex legal and financial transactions, and his hiring further demonstrates our commitment to deepening our transactional service offerings.”

During his 30-year legal career, Mr. Harris has handled a wide range of corporate, technology, tax and litigation matters for clients of all types and sizes, including: Merge Healthcare’s acquisitions of AMICAS and Ophthalmic Imaging Systems and various other transactions; Munich Re in its acquisition of the Windsor Health Group; The management teams of CDW Corporation and Nuveen Investments in their going-private transactions led by Madison Dearborn Partners; A Special Committee of the Chicago Board of Trade in its acquisition by the Chicago Mercantile Exchange; Click Commerce in its sale to Illinois Tool Works; and Merrick Ventures, Winona Capital, Edgewater Capital, MH Equity, GTCR Golder Rauner and others on various private equity investments or sales.

“Mark’s experience in mergers and acquisitions will enhance our ability to provide exceptional service to public and private companies and is another example of the growth of the firm’s transactional footprint,” said Joseph Gromacki, Chair of Jenner & Block’s firm-wide Corporate Department and a member of the firm’s Governing Committee.  “With his strong experience representing clients of all types and sizes in a wide range of corporate matters, Mark’s capabilities fit perfectly with our practice.  Mark’s skills significantly augment our bench strength in the private equity space.”

Mr. Harris has also done work for many public companies, including Las Vegas Sands, Heritage Crystal-Clean, Covance, DeVry and DaVita, among others.  His earlier transactions involved the acquisitions of Pebble Beach Resorts and RJR Nabisco, as well as a variety of deals for Kohlberg, Kravis & Roberts; Sears, Roebuck and Co.; Harrah’s Entertainment; Playtex; and Bally Total Fitness.

“I am excited to be joining a firm with the history and client portfolio that Jenner & Block has, and I look forward to being part of a team that is growing rapidly, both in terms of the volume and the significance of the merger and acquisitions work it is undertaking for its clients,” said Mr. Harris.

Prior to joining Jenner & Block, Mr. Harris was a partner at McDermott Will & Emery and prior to that was the COO and a Principal, Portfolio Manager of GTCR Golder Rauner.  He has also served as a senior executive and the chief legal officer for two VC-backed technology companies – PrairieComm and Click Commerce – and has been an outside Director of two public companies, including Global Imaging Systems, a distributor and servicer of computer peripherals and copiers, which was acquired by Xerox in 2007.  Mr. Harris was previously also a partner at Latham & Watkins in Chicago.

Jenner & Block is a national law firm with approximately 450 attorneys and offices in Chicago, Los Angeles, New York and Washington, DC.  Founded in 1914, Jenner & Block is known for its prominent and successful litigation practice and experience handling sophisticated and high-profile corporate transactions.  Firm clients include Fortune 100 companies, large privately held corporations, financial services institutions, emerging companies, venture capital and private equity investors (www.jenner.com).

© 2012 PEPD • Private Equity’s Leading News Magazine • 11-27-12

Versa Capital Acquires Eastern Mountain Sports

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Versa Capital Management has acquired Eastern Mountain Sports (EMS), a retailer of outdoor apparel and equipment.  Mark Walsh, a Versa Principal and Chairman of Bob’s Stores, a northeastern apparel retailer and a portfolio company of Versa, will serve as Chairman of the Board of EMS.

“We are pleased to welcome EMS into our organization and to further expand Versa’s retail interests,” said Gregory Segall, CEO of Versa Capital. “EMS brings a 45-year history of marketing products for serious outdoor enthusiasts and is a natural fit for our existing expertise in both the retail and outdoor sectors. With a new capital structure and the other resources that Versa can offer, EMS will have many new opportunities to develop its branded products and better serve its customers.”

Eastern Mountain Sports is an operator of 69 retail stores in the Northeast US that sell brand name and private label outdoor apparel and equipment.  The company also sells its products online through its website (www.ems.com). The company was founded in 1967 and is based in Peterborough, NH.

Versa Capital Management invests in special situations involving middle market companies with revenues in the $100 million to $1 billion range or assets of $25 million to $500 million. The firm has $1.2 billion of capital under management and is based in Philadelphia, PA (www.versa.com).

Versa’s portfolio includes Bob’s Stores, a northeastern apparel retailer that was recognized in 2011 as Connecticut’s Retailer of the Year; Avenue Stores, a chain of trend-right, multi-channel stores offering affordable fashion for real size women; and Black Angus Steakhouses, a chain of family-oriented steak restaurants in the western states.

Duff & Phelps acted as exclusive financial advisor to EMS.

© 2012 PEPD • Private Equity’s Leading News Magazine • 11-27-12

Monomoy Capital Partners Acquires MPI

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Monomoy Capital Partners has acquired the assets of MPI, a manufacturer of high-precision, fineblanked metal components for powertrain systems, from Revstone Industries.

“MPI’s fineblanked product offering and experienced management team create an unmatched foundation for capitalizing on positive trends in automotive transmission components,” said Monomoy Partner Daniel Collin. “We are thrilled to add MPI to the Monomoy portfolio of companies.”

MPI is a manufacturer of automatic transmission products, supplying automotive original equipment manufacturers with clutch plates, separator plates, and backing plates. The company’s automotive customers include several large car makers and an array of Tier I automotive suppliers. MPI also manufactures safety-critical and hydraulic components for heavy duty vehicles and general industrial customers. The company employs over 700 team members at four North American manufacturing facilities and at its corporate headquarters in Southfield, MI (no website found).

“This transaction represents an exciting next step in MPI’s evolution as the premier fineblanked component supplier in North America,” said Mark Mitchell, Chief Executive Officer of MPI. “Monomoy’s operational expertise and strategic guidance will provide MPI with the necessary resources and capital to expand and improve our operations both domestically and abroad. We look forward to the opportunities ahead.”

Garry Jaunal and Stacey Kern from Baker & McKenzie provided Monomoy with legal counsel and Ernst and Young provided financial and accounting diligence. Wells Fargo provided acquisition financing for the transaction.

Monomoy Capital Partners has $700 million in assets under management and makes control investments in middle market businesses in the manufacturing, distribution, consumer product and foodservice industries. Over the past five years, Monomoy has closed over 30 middle market acquisitions, and its companies currently produce over $1.1 billion in combined sales and employ more than 4,500 people across four continents, from North America to Asia. The firm is headquartered in New York, NY (www.mcpfunds.com).

© 2012 PEPD • Private Equity’s Leading News Magazine • 11-27-12

First Reserve Acquires Ameriforge Group

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First Reserve Corporation has acquired Ameriforge, a manufacturer of products used in the oil and gas industry.  Ameriforge was owned by Post Oak Companies which is affiliated with Tanglewood Investments.  The executive management team of Ameriforge will remain in place and will retain an equity interest in the company. In addition, the three founders and principals of Tanglewood will be continuing equity investors in Ameriforge.

Ameriforge is a vertically integrated manufacturer of engineered products, subassemblies and integrated systems for the oil and gas, midstream, downstream, power generation, aerospace, transportation and industrial markets. The company has 29 facilities in five countries and is based in Houston, TX (www.ameriforge.com).

“First Reserve’s investment represents a key milestone for our company. During our partnership with Tanglewood, we were able to transform Ameriforge from a single location flange forging company focused on the North American market to a fully-integrated, 29 facility international manufacturing enterprise which is providing a growing array of highly technical products and related services to the global energy, aerospace and transportation industries. We believe our business model is uniquely poised for continued significant growth and could not be more pleased that we are beginning a new partnership with First Reserve,” said Gean Stalcup, CEO of Ameriforge.

First Reserve is a private equity firm with a focus on the energy industry.  The firm was founded in 1983 and has offices in Houston, TX; Greenwich, CT and London, UK (www.firstreserve.com).

“Our management team is highly confident that First Reserve’s experience and knowledge in the energy industry will assist us as we continue to grow our suite of products and related services to better serve our customer base around the world. We will also benefit substantially from First Reserve’s industry knowledge, financial strength and deep experience in providing companies like ours effective access to growth capital. Finally, I’d like to offer my personal thanks to the team at Tanglewood for their enduring support, to our employees for their tireless efforts in creating this enterprise and to our customers whose continued trust in our products and services has fueled our growth and success.”

Tanglewood invests in middle market equipment manufacturing companies serving the energy industry. The firm is based in Houston (www.tanglewoodinv.com).

“My two partners at Tanglewood and I could not be more pleased with this transaction. We are strong believers in the future of Ameriforge and have affirmed that conviction by our continuing personal investments in the company alongside First Reserve. I very much look forward to continuing my relationship with Ameriforge as a member of its Board of Directors. The time had come for Ameriforge to seek a larger and more capable financial partner in order for the company to realize its full potential. First Reserve is an ideal fit in every respect to be that partner,” said Michael Tiner, Managing Director of Tanglewood and current Chairman of Ameriforge Group.

Harris Williams & Co. is the exclusive advisor to Ameriforge.

© 2012 PEPD • Private Equity’s Leading News Magazine • 11-27-12