Archives for May 1, 2013

Kohlberg & Company Closes Fund 7 at Hard Cap

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Kohlberg & Company has closed its seventh private equity fund, Kohlberg Investors VII, L.P., with $1.6 billion in commitments. The new fund surpassed its $1.5 billion target and closed at its hard cap.

“We received strong investor demand for this fund, and are deeply gratified by the continued support from our existing limited partners and pleased to welcome the limited partners who have joined our investor group,” said Sam Frieder, Managing Partner at Kohlberg. “Our success in raising Fund VII is continued validation of our investment philosophy and the strength and quality of our team over the last 25 years.”

Over 50 investors participated as limited partners in the new fund. “This outcome is consistent with the goals that we set at the commencement of the fundraising process in terms of investor quality, scale and geography,” said Mr. Frieder. “We are delighted with the complementary mix of existing and new investors that comprise the fund, and with the geographic diversity of our limited partner base. Over 20% of committed capital comes from investors located outside of the US, primarily in Europe and Asia.”

Lazard acted as placement agent for Kohlberg, while Ropes & Gray served as the firm’s legal counsel.

Kohlberg & Company is a control investor in a variety of industries including industrial manufacturing; consumer products; business services; healthcare services; and financial services. The firm concentrates on transactions with EBITDA between $20 million and $100 million where it can invest between $50 million and $200 million of equity. Presently, Kohlberg’s portfolio encompasses 19 companies with total revenues of approximately $7 billion. Kohlberg was founded in 1987 and is based in Mt. Kisco, NY (www.kohlberg.com).

© 2013 PEPD • Private Equity’s Leading News Magazine • 5-1-13

Resilience Adds New CFO and Operations Pro, Promotes 2

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Resilience Capital Partners has added two new team members with the hiring of Theodore Laufik as the firm’s new Chief Financial Officer and Chief Compliance Officer, and Robert Northrop as a new Senior Vice President – Operations Group. Resilience has also promoted Michael Cavanaugh to Partner and Megan McPherson to Vice President.

Mr. Laufik joins Resilience with more than 25 years of private equity experience with Morgenthaler and Foundation Medical Partners. He began his career with Deloitte and is a Certified Public Accountant. During his career Mr. Laufik has helped raise $3 billion of investment capital and has provided financing to over 350 companies across several industries. He was responsible for deal structuring and execution, investor relations, strategic planning, financial reporting, management information systems and other administrative functions at Morgenthaler. Mr. Laufik holds an MBA and BBA from Cleveland State University.

“Ted’s tremendous background and depth of experience will be an invaluable asset to our firm. His experience in both private equity administration and investor relations positions us very well as we continue to focus on our long term growth plans,” said Bassem Mansour, Co-CEO, Resilience.

Mr. Northrop joins Resilience’s Operations Team as Senior Vice President focused on supporting the implementation of value creation plans and operational support across Resilience’s portfolio companies. Prior to joining Resilience, he was an Associate Partner with McKinsey & Company. He has specialized in serving industrial companies in pricing and sales; lean operations and supply chain; and strategy engagements. Prior to McKinsey, Mr. Northrop served as the Director of Client Services for Tallán, an information technology consulting firm that specializes in developing custom software solutions for businesses. He holds an MBA from the University of Virginia and his BS from Northwestern University.

“Rob’s expertise and experience at McKinsey will be a valuable resource to the firm as it performs due diligence and underwriting support on new investment opportunities and as an interim support resource to Resilience portfolio companies,” said Ulf Buergel, Operating Partner, Resilience.

“As our firm has grown over the past 12 years we would also like to recognize the tremendous contributions made by Mike Cavanaugh and Megan McPherson. Both have played key roles on our investment team,” said Steven Rosen, Co-CEO, Resilience. “Mike’s leadership and experience in evaluating new investment opportunities and working with management teams as well as Megan’s comprehensive support and keen analytical skills have contributed to our success.”

Michael Cavanaugh first joined Resilience in 2006 and is responsible for deal origination, investment due diligence and portfolio company oversight. Prior to joining Resilience, he was a turnaround consultant at Conway MacKenzie, an M&A attorney at Kaye Scholer and a distressed securities trader and investment banker at Merrill Lynch. Mr. Cavanaugh earned a JD from the University of Michigan Law School, an MBA from the University of Michigan Business School and a BA from Columbia University.

Megan McPherson joined Resilience in 2007. Her responsibilities include investment due diligence, transaction execution, and monitoring of portfolio companies. Prior to Resilience, she worked in corporate and investment banking at KeyBanc Capital Markets. Ms. McPherson received her BBA from the University of Notre Dame.

Resilience Capital Partners specializes in investing in middle market companies with $25 million to $250 million in revenues across a range of industries. The firm’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 28 companies under 20 platforms with over $2 billion in revenues. The firm is based in Cleveland (www.resiliencecapital.com).

© 2013 PEPD • Private Equity’s Leading News Magazine • 5-1-13

J. W. Childs Promotes and Hires

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J.W. Childs Associates has promoted Todd Fitzpatrick from Vice President of Finance to Chief Financial Officer and Hemanshu Patel from Senior Associate to Vice President. The firm has also hired Jeffrey Miller as a Vice President.

Mr. Fitzpatrick oversees financial reporting, accounting and fund administration for J.W. Childs. Mr. Miller and Mr. Patel are primarily responsible for deal sourcing, due diligence and analysis of new investment opportunities and monitoring of portfolio companies.

“We are very pleased to announce Todd’s and Hemanshu’s well-deserved advancements, and to welcome Jeff to the J.W. Childs team,” said Jeff Teschke, Partner. “Todd has nearly 20 years of directly applicable financial management experience and he will play a critical role in continuing to drive growth at J.W. Childs. Jeff and Hemanshu both have notable experience in our industry sectors of focus. Their expertise will prove valuable as we seek new investment opportunities and continue to implement our operationally-focused value creation strategy.”

Mr. Fitzpatrick joined J.W. Childs in 2012. He was previously the CFO at Nexus Medical & Technology Capital, a Boston-based private equity firm. From 1994 to 1998, he was with Coopers & Lybrand. Mr. Fitzpatrick received a BA degree from Bowdoin College and MBA and MSA degrees from Northeastern University.

Mr. Miller joined J.W. Childs from Sawaya Segalas & Co., a New York-based investment bank focused on consumer M&A. He was previously in the retail and consumer products practice of L.E.K. Consulting, an international strategy consulting firm. Mr. Miller received an AB in Economics from Harvard University.

Mr. Patel joined J.W. Childs in 2007 as an Associate. Previously, he was an investment banker at Citi where he focused on the technology, media and telecommunications sectors. Mr. Patel received a BS degree in Finance from Rutgers University.

J.W. Childs Associates invests in middle market companies based in North America. Sectors of interest include consumer products, specialty retail and healthcare. The firm was founded in 1995 and is based in Waltham, MA (www.jwchilds.com).

© 2013 PEPD • Private Equity’s Leading News Magazine • 5-1-13

Arsenal Acquires Arnco

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Dash Multi-Corp., a portfolio company of Arsenal Capital Partners and a provider of polyurethane systems, vinyl plastisols and recycled rubber products, has acquired Arnco, a supplier of polyurethane products. Arnco is the first add-on acquisition for Dash Multi-Corp. which was acquired by Arsenal in December 2012.

Arnco is a supplier of polyurethane products and operates through five main business units: (1) Arnco Tire Flatproofing, a manufacturer of tire flatproofing systems (flatproofing is the process of pumping liquid polyurethane into a tire through the valve system replacing the air in any pneumatic tire); (2) Arnco Performance Polymers, a manufacturer of high-performance polyurethane systems; (3) Carefree Tire, a supplier of light weight, solid, micro-cellular polyurethane tires; (4) Arnco Construction Products, a provider of flexible and rigid roofing spray foams and UV protective coatings; and (5) Arnco Europe, based in Manchester, UK, provides manufacturing and customer support internationally for Arnco. Arnco was founded in 1971 and is headquartered in South Gate, CA. The company has manufacturing capabilities in South Gate, CA; Berea, OH; Manchester, UK; and Jiaxing City, China (www.arnconet.com).

“Arnco is the global market innovator in the tire flatproofing systems market and is the first acquisition of several we expect to make globally to extend the reach of Dash,” said Tim Zappala, a Partner at Arsenal Capital Partners and co-head of the firm’s Specialty Industrials Group.

Dash Multi-Corp is a manufacturer of formulated polyurethane, vinyl plastisol, specialty coatings as well as recycled rubber products. Dash is headquartered in St. Louis and has seven production facilities in the U.S. (www.dashmulticorp.com).

“Arnco has a long history of innovation in the polyurethane market, providing great solutions and service to its customers. The combination of Dash and Arnco represents an important milestone in our strategy to further build a leading polyurethane business offering a broad portfolio of products and technologies that serve multiple end markets,” said John Televantos, a Partner at Arsenal Capital Partners and co-head of the firm’s Specialty Industrials Group.

Arsenal Capital Partners invests in middle-market specialty industrial and healthcare companies that have $50 million to $250 million in enterprise value. Industries of specific interest include: specialty & fine chemicals; segments of healthcare; transportation and logistics; power generation; aerospace & defense; and process industry components and services. Arsenal Capital Partners recently completed fundraising for Arsenal Capital Fund III with $875 million of committed capital, exceeding its target of $750 million. The firm’s previous fund, Arsenal Capital Partners II, was raised in 2006 with $500 million of committed capital. Arsenal now has over $1.6 billion of committed capital under management. The firm was founded in 2000 and has offices in New York and Shanghai (www.arsenalcapital.com).

© 2013 PEPD • Private Equity’s Leading News Magazine • 5-1-13

Platte River Exits Hetsco

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Platte River Equity has sold its portfolio company Hetsco, a provider of repair services for heat exchangers, to Global Power Equipment Group. Platte River acquired Hetsco in September 2008.

“We are proud of Hetsco’s development over the past several years under the leadership of Sam Willard and Steve Powell,” said Platte River Managing Director Peter Calamari. “In this environment of increasing investment in industrial gas production and processing, Hetsco is poised for continued success. We are also pleased that the company will be owned by Global Power, a strong and supportive new partner for Hetsco and its employees.”

Hetsco is a provider of repair and maintenance services for brazed aluminum plate heat exchangers used in industrial gas, liquefied natural gas and chemical facilities, as well as a provider of maintenance, fabrication, construction, relocation and safety services to the industrial gas, gas processing, liquefied natural gas, and utility companies. Hetsco was founded in 1981 and is headquartered in Greenwood, IN (www.hetsco.com).

“The financial, strategic and operational support Platte River has provided to Hetsco over the last five years has been invaluable. We accomplished all we had set out to do, and Platte River was a critical partner in our success. We look forward to a new chapter of continued growth with Global Power,” said Sam Willard, President of Hetsco.

Global Power (NASDAQ: GLPW) is a provider of custom-engineered auxiliary equipment and maintenance support services to the global power generation industry. The company is headquartered in Irving, TX (www.globalpower.com).

St. Charles Capital, an investment bank based in Denver (www.stcharlescapital.com) served as the exclusive financial advisor to Hetsco. TM Capital, an investment bank based in New York, Boston and Atlanta (www.tmcapital.com), served as financial advisor to Global Power.

Platte River Equity makes equity investments of $10 million to $50 million in lower middle market companies with enterprise values generally between $20 million and $250 million. Sectors of interest include aerospace and transportation; energy and industrial services; and chemicals, metals and industrial minerals. Platte River Equity manages funds with committed capital of approximately $700 million and is based in Denver (www.platteriverequity.com).

© 2013 PEPD • Private Equity’s Leading News Magazine • 5-1-13

Vicente Acquires Precision Diagnostic Systems and SleepEasy Therapeutics

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MedBridge Healthcare, a portfolio company of Vicente Capital Partners, has acquired Precision Diagnostic Systems, a provider of sleep disorder services, and SleepEasy Therapeutics, a provider of sleep disorder products.

These acquisitions extend MedBridge Healthcare’s geographic footprint into Minnesota, North Dakota, South Dakota, Illinois, Iowa, Michigan, and Wisconsin, making the company the second largest provider of sleep diagnostic services and respiratory therapy services in the United States.

Precision Diagnostic Systems (PDS) is a provider of sleep disorder diagnosis and testing services. The company was founded in 1998 and is based in Fargo, ND (www.pdssleep.com).

SleepEasy Therapeutics (SET) is a provider of continuous positive airway pressure products (CPAP) including nasal masks, tubing and related accessories. The company operates stores in Fargo and Grand Forks, ND; Sioux Falls, SD; and St. Cloud, MN (www.sleepeasyrx.com).

“We are very excited about MedBridge’s acquisition of these two companies. The combined businesses complement each other very well and the acquisition solidifies MedBridge’s position as one of the largest healthcare platforms in the sleep disorder and continuous positive airway pressure products therapy market,” said Klaus Koch, Managing Partner of Vicente Capital Partners and Chairman of the Board of MedBridge Healthcare. “Matt Mellott and the team at MedBridge have been laser focused on the buy and build strategy that they laid out when we partnered with them to acquire MedBridge, and we are pleased to be able to support them.”

MedBridge Healthcare was acquired by Vicente Capital Partners in 2008 and is a provider of diagnostic services and respiratory therapy services for patients with Obstructive Sleep Apnea (OSA) and other sleep disorders. The company provides services for patient identification, testing, diagnosis, treatment, and long-term care management of OSA patients. The company was founded in 2004 and is based in Greenville, SC (www.medbridgehealthcare.com).

Vicente Capital Partners makes non-control and control investments in businesses that have annual revenues between $5 million and $50 million. Sectors of interest include business services (outsourced services, Internet services, telecom services); consumer services (healthcare services, residential delivery, education); and specialty manufacturing (aerospace & defense, environmental products, networking/telecom equipment). The firm is based in Los Angeles (www.vicentecapital.com).

“This was truly a unique opportunity to acquire two of the premier businesses in the sleep diagnostic and CPAP therapy management market in the Midwest,” said Matt Mellott, President of MedBridge Healthcare. “We are very excited about the potential to leverage the platform that we have built at MedBridge and the talent and resources at PDS and SET to continue to meet the needs of the 50 million Americans that have sleep disorders.”

© 2013 PEPD • Private Equity’s Leading News Magazine • 5-1-13

ABRY Partners Acquires Capital Insurance Agency of Trenton

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Confie Seguros, a U.S. personal lines insurance broker primarily serving the Hispanic population and a portfolio company of ABRY Partners, has acquired Capital Insurance of Trenton.

ABRY Partners acquired Confie Seguros from Genstar Capital in November 2012. So far in 2013, Confie Seguros has acquired four companies and is expected to complete additional transactions in the second half of the year as it continues to assess its pipeline of potential investments. Confie Seguros completed 22 acquisitions in 2012.

Capital Insurance Agency of Trenton specializes in personal insurance lines as well as commercial insurance. The company was founded in 1935 and is based in Trenton, NJ (www.capitalinsuranceagency.net).

“We are pleased to add Capital Insurance as we strengthen our focus on New Jersey and the surrounding region. In addition, we recently added Jayla Insurance Agency as a fold-in acquisition for our Paterson office,” said Joe Waked, CEO of Confie Seguros.

Confie Seguros is a national insurance distribution company primarily focused on the insurance needs of Hispanic consumers. Confie Seguros has annual revenue approaching $200 million with over 300 retail locations. The company has leading market positions in California, Arizona, Texas, Florida, Washington, Oregon, New York, New Jersey, and Nevada and expects to continue its expansion in those and other states, including Illinois, Georgia, and the Carolinas. The company was founded in 2008 and is based in New York (www.confieseguros.com).

ABRY Partners invests in the media, communications and information sectors. ABRY is currently investing ABRY Partners VII (a $1.6 billion fully-capitalized traditional private equity fund), ABRY Senior Equity III (a $750 million fully-capitalized senior equity/mezzanine fund) and ABRY Advanced Securities Fund II (a $1.2 billion fully-capitalized senior debt fund). The firm is headquartered in Boston (www.abry.com).

© 2013 PEPD • Private Equity’s Leading News Magazine • 5-1-13