KPS Capital Partners has completed a recap of its portfolio company Waupaca Foundry. The proceeds of the recapitalization, funded by a $200 million upsizing of the company’s term loan, were used to fund a $200 million cash distribution to stockholders.
KPS acquired ThyssenKrupp Waupaca, Inc., which was renamed Waupaca Foundry, Inc., from ThyssenKrupp Budd Company in June 2012. Waupaca Foundry is the largest iron foundry company in the world and produces gray and ductile iron castings using state-of-the-art technology. Waupaca is a North America’s leading supplier of iron castings to the automotive, truck, agriculture, construction, hydraulics and commercial vehicle markets. The company operates six manufacturing facilities located in Wisconsin (4), Indiana, and Tennessee. The company employs approximately 3,700 people and is headquartered in Waupaca, WI (www.waupacafoundry.com).
“Waupaca is now a thriving independent company under KPS’ ownership, and we are pleased to return capital to our stockholders. This recapitalization validates the successful transformation of Waupaca that was achieved in a very short period of time,” said Gary Gigante, Chief Executive Officer of Waupaca. “Our conservative capital structure and the financial support of our stockholders provide us with the resources to support our customers and grow aggressively, both organically and through acquisitions.”
Financing for the transaction was provided by a syndicate of banks and institutional investors with GE Capital Markets acting as Lead Arranger. RBC Capital Markets acted as special advisor to KPS.
KPS Capital Partners is the manager of the KPS Special Situations Funds, a group of private equity funds with over $2.5 billion of committed capital focused on investing in restructurings, turnarounds and other special situations. KPS has created new companies to purchase operating assets out of bankruptcy; established stand-alone entities to operate divested assets; and recapitalized highly leveraged public and private companies. The KPS investment strategy targets companies with strong franchises that are experiencing operating and financial problems. KPS portfolio companies, as of September 30, 2012, have aggregate annual revenues of approximately $6.8 billion, operate 85 manufacturing plants in 25 countries, and employ over 29,000 associates, directly and through joint ventures worldwide. KPS Capital Partners is headquartered in New York (www.kpsfund.com).
© 2013 PEPD • Private Equity’s Leading News Magazine • 2-11-13