September 26, 2013
Search

Private Equity Professional

Private Equity's News Leader

There is a right and a wrong in the universe, and that distinction is not hard to make.
Superman

You are here: Home / 2013 / September / Archives for 26th

Archives for September 26, 2013

Palladium Hits Home Run on Partial Exit of Regional Management

by

palladium nfRegional Management Corp., a diversified specialty consumer finance company and a portfolio company of Palladium Equity Partners, has completed the closing of a secondary offering of its common stock at a price of $27.50 per share.  In the secondary offering, Palladium sold 69% of its holdings in Regional Management, representing proceeds of $67 million, or a 5x return on that portion of the firm’s investment.  Palladium first invested in Regional Management in 2007 and the company went public in 2012.

Regional (NYSE:RM) is a consumer finance installment loan business offering a variety of credit products to individuals with limited access to traditional sources of consumer credit. Each of its loan products is structured on a fixed rate, fixed term basis with fully amortizing equal monthly installment payments and is repayable at any time without penalty. Regional Management’s loans are sourced through its multiple channel platform, including in its branches, through direct mail campaigns, independent and franchise automobile dealerships, online credit application networks, furniture and appliance retailers, and its consumer website.  The company currently operates 198 branch offices in South Carolina, Texas, North Carolina, Tennessee, Alabama, Oklahoma and New Mexico. The company was founded in 1987 and is headquartered in Greenville, SC (www.getregionalcash.com).

Palladium Equity Partners targets investments in business services companies as well as in financial services, consumer/retail, food/restaurants, healthcare, industrial, and media businesses. Palladium has a focus on companies that operate in the US Hispanic market. The principals of Palladium have invested over $1.5 billion of equity in 50 portfolio companies over the last two decades.  The firm was founded in 1997 and is based in New York (www.palladiumequity.com).

Stephens, Keefe, Bruyette & Woods, BMO Capital Markets Corp. and JMP Securities served as joint book-running managers for the offering, and FBR Capital Markets & Co. served as the co-manager.

© 2013 PEPD • Private Equity’s Leading News Magazine • 9-26-13

University of Michigan to Host Annual Private Equity Conference

by


ross nfsThe Zell Lurie Institute for Entrepreneurial Studies and its Center for Venture Capital and Private Equity Finance at the University of Michigan’s Ross School of Business today unveiled details for its eighth annual Michigan Private Equity Conference, taking place October 3 and 4. The ’boutique’ conference will cover current and emerging topics in the nation’s credit markets that pose challenges and new opportunities for those in private equity and institutional investing. More than 200 private equity, investment banking and business professionals from around the United States and from the University of Michigan alumni community are expected to attend. The 8th annual conference will be headlined by Kevin Albert of Pantheon Ventures and John Diggins of Platinum Equity Partners.

“Today, the private equity sector is certainly healthy and well-funded, but it has shifted its sights away from strictly doing buyouts, to providing growth capital to younger, high-potential companies in the post-venture-capital stage of financing,” said David Brophy, director of the Center for Venture Capital and Private Equity Finance at the University of Michigan Ross School of Business. “Private equity shops are finding value in this middle market area, and that’s where they’re doing a lot of their investments. These are just a sampling of the kinds of deals that get done at the event and company owners who want to meet these types of investors should attend this conference, which is the best of its kind in the Midwest.”

A pre-conference golf outing at the University of Michigan golf course and dinner reception will be held on Thursday, October 3. The conference will kick off at 7:30AM on Friday, October 4 with a networking breakfast. The opening keynote address will be delivered by Kevin Albert, global head of business development at Pantheon Ventures, an international private equity fund-of-funds manager. Mr. Albert will shine a spotlight on new trends in fundraising by private equity shops. A second keynote address will be delivered later in the morning by John Diggins, a partner at Platinum Equity Partners. Mr. Diggins will share his insights into where the California-based private equity firm is placing its investment dollars and what attracted the firm to the state of Michigan. He will also speak about Platinum Equity’s stake in the Detroit Pistons and the firm’s experience with the NBA franchise.

In addition, a series of panel discussions and networking lunch will be held. Panelists include:

  • Eric Dykema, Lineage Capital LLC
  • Gerry Boylan , Long Point Capital
  • Frank Muller, Jr., Behringer Harvard Holdings, Inc.
  • Michael Oleshansky , PSP Capital Partners LLC
  • Joseph O’Connor , AlpInvest Partners
  • Bruce Engler, Faegre Baker Daniels LLP
  • Mike Vlasic , Vlasic Investments
  • Jeff Arnesen , Houlihan Lokey
  • Michael Faremouth , Linsalata Capital Partners
  • Sandra Bosela , OPTrust Private Markets Group
  • Brian Demkowicz , Huron Capital
  • Brendan Edmonds, Atlantic-Pacific Capital
  • Eric Wilcomes, DuPont Capital Management Corp.
  • Shawn Winnie, State of Michigan Department of Treasury

Post-conference, Mr. Brophy will host a ‘fireside chat’ on investment banking and the path to private equity, which is open to the public. The panel starts at 3:00PM in room 1210 at the Ross School of Business. Panelists include representatives from Kohlberg & Company, Blackstone Group, Pine Brook Partners, Apollo Global Management and Moelis & Company.

Online registration for the conference is open through Wednesday, October 2. For more information or to register, click HERE.

About the Samuel Zell & Robert H. Lurie Institute for Entrepreneurial Studies
The Institute and its Center for Venture Capital and Private Equity Finance bring together a mix of knowledge, experience and opportunities from the front lines of entrepreneurship and alternative investments. The student learning experience is further enhanced through internships, entrepreneurial clubs and events that serve to provide viable networks and engage the business community.  The School’s three student-led investment funds, with over $6.5 million under management, immerse students in the business assessment and investment process. Founding Board Members include Samuel Zell, Chairman of Equity Group Investments and Eugene Applebaum, Founder of Arbor Drugs.  For more information, visit the Institute at www.zli.bus.umich.edu.

© 2013 PEPD • Private Equity’s Leading News Magazine • 9-26-13

Brentwood Expands Business Development Team

by

staff nfConsumer-focused private equity investment firm Brentwood Associates has hired Scott Staff as a Managing Director focused on business development.

“We’ve worked closely with Scott for the past decade, and we’re confident he will expand our business development efforts,” said Bill Barnum, Partner at Brentwood and co-founder of the firm’s private equity group.

Prior to joining Brentwood, Mr. Staff worked at Perkins Coie, an international law firm, where he served as the firm’s global director of business development for over nine years. He served as Vice President for College Relations at Lewis and Clark College before joining Perkins Coie. He is a graduate of Lewis and Clark Law School and College.

Brentwood Associates is a consumer-focused private equity investment firm with over $850 million of capital under management. Sectors of interest include branded consumer products; consumer and business services; direct marketing, including direct mail and e-commerce; education; health and wellness; restaurants; and specialty retail. The firm was founded in 1972 and is based in Los Angeles (www.brentwood.com).

© 2013 PEPD • Private Equity’s Leading News Magazine • 9-26-13

Praesidian Capital Expands Team

by


praesidian nfPraesidian Capital, a provider of senior and subordinated debt for small and mid-sized companies, has promoted Alex Massimo from Analyst to Associate and Thomas (“TJ”) O’Donnell was hired as an Analyst.

“Alex’s promotion is well deserved, and we are very pleased to welcome TJ to the team,” said Jason Drattell, Founder and Managing Partner of Praesidian. “We know that their expertise will be extremely useful as we monitor our current portfolio and explore new investment opportunities.”

Mr. Massimo joined Praesidian earlier this year from the Leveraged Finance Origination Group at UBS Investment Bank. With his expanded role, he will take on additional responsibilities in all aspects of the firm while he focuses on portfolio management and assists on new investments. He received his BS in Finance and Economics and a minor in Mathematics from Boston College.

Mr. O’Donnell was previously an Analyst in US Institutional Equity Sales with Nomura Securities International. His new responsibilities at Praesidian include financial analysis, due diligence and execution of new investments.  He received his BS in Finance with a minor in Business Law and Corporate Governance from Villanova University.

Praesidian Capital provides mezzanine capital to small and mid-sized businesses. The firm typically invests in connection with a management/leveraged buyout, recapitalization or refinancing. Praesidian manages over $700 million in committed capital and is based in New York (www.praesidian.com).

© 2013 PEPD • Private Equity’s Leading News Magazine • 9-26-13

Pfingsten Acquires Allied Reliability Group

by

allied nfPfingsten Partners has made a majority investment in Allied Reliability Group, a provider of industrial reliability and maintenance services. The founding shareholders of Allied retain a significant ownership stake in the company. This is the thirteenth platform investment for the Pfingsten’s $525 Million Fund IV.

“Allied has a unique value proposition and is well positioned in the growing condition based monitoring and asset reliability market,” said John Underwood, Senior Managing Director at Pfingsten. “The Allied management team built a great business and we are excited to partner with them to assist with further growth.”

Allied Reliability Group provides reliability and maintenance services that help industrial companies and government agencies reduce maintenance costs and increase equipment uptime and throughput. Services include condition based monitoring, reliability and operational consulting, training, staffing and integrated software solutions. The company was founded in 1997 and is based in Charleston, SC (www.alliedreliabilitygroup.com).

“The future is bright for Allied,” said Allied Partner and Co-Founder, John Schultz, “with Pfingsten’s operational expertise, global capabilities and financial support we will have the resources to embark on our next stage of growth by investing in a broader service offering and expanding our reach internationally.”

Pfingsten Partners invests in middle market manufacturing, distribution and business services companies. Since completing its first investment in 1991, Pfingsten Partners has acquired 91 manufacturing, distribution, and business service companies and has over $1 billion of capital under management. The firm is based in Chicago and has offices in New Delhi and ChangAn, China (www.pfingsten.com).

© 2013 PEPD • Private Equity’s Leading News Magazine • 9-26-13

Tillery Capital Exits SCT

by

sct nfTillery Capital has sold its portfolio company SCT Holdings, an auto products supplier, to the Global Environment Fund. Tillery Capital acquired SCT in October 2007.

SCT is a supplier of engine and transmission calibration products for the performance automotive aftermarket and light-duty fleets. SCT’s branded products are used by automotive enthusiasts seeking to increase a vehicle’s performance, and more recently, fleet operators who recognize fuel savings by using SCT’s fleet products. The company is based in Sanford, FL (www.sctflash.com).

Tillery Capital is an operationally-oriented private equity firm that invests in and builds lower middle-market companies in partnership with their management teams. The firm makes control equity investments in companies whose annual EBITDA is between $2 million and $10 million. Sectors of specific interest include: agriculture products and equipment; niche manufacturing businesses; commercial and industrial service companies; healthcare services; environmental services; and operationally complex businesses. Tillery Capital was founded in 2006 and has offices in Charlotte and Raleigh, NC and Indianapolis (www.tillerycapital.com).

Global Environment Fund (GEF) is a global alternative asset manager with approximately $1 billion in assets under management. The firm focuses on investments in the energy, environment, and natural resources sectors. GEF was founded in 1990 and is based in Chevy Chase, MD (www.globalenvironmentfund.com).

BB&T Capital Markets served as the exclusive financial advisor to SCT and Tillery Capital. BB&T Capital Markets provides capital and advisory services including research, sales and trading, equity and debt underwriting, M&A advisory and corporate banking. The group has specific expertise within eight distinct industry verticals: aerospace, defense & government services; automotive aftermarket; commercial & industrial; financial Services; food & agribusiness; logistics & transportation services; real estate; and retail & consumer. BB&T Capital Markets is headquartered in Richmond, VA; with offices in Boston, MA; and Reston, VA (www.bbtcapitalmarkets.com).

The group’s parent, BB&T, is one of the largest financial services holding companies in the US with $182.7 billion in assets and a market capitalization of $23.8 billion, as of June 30, 2013. BB&T is based in Winston-Salem, NC.

© 2013 PEPD • Private Equity’s Leading News Magazine • 9-26-13

CI Capital Partners Acquires Roy Tailors Uniform

by

roy tailors nfGalls, a portfolio company of CI Capital Partners, has acquired Roy Tailors Uniform Co. Galls was acquired by CI Capital Partners in September 2011, as a platform investment in the public safety products market and the buy of Roy Tailors is the second add-on acquisition for Galls under CI Capital’s ownership. The company also purchased Quartermaster in January 2012.

Roy Tailors provides uniforms and accessories to police, fire, EMS, postal, industrial, transit and hospitality employees. The company, family owned and operated for over 50 years, is headquartered in Cincinnati with a second operation in Columbus (www.roytailors.com).

“My father began Roy Tailors in 1958 by selling postal uniforms out of the trunk of his car. We have grown immensely since those humble beginnings, and it has been my greatest honor to serve the fine men and women in uniform. Joining the Galls family, with its broad product offerings, wide distribution capabilities, and advanced technology platform, enables us to take the next step forward and service our customers at an even greater level. We are thrilled with this partnership.”

Galls is a supplier of uniforms and equipment to public safety professionals. Galls markets under the brand names Galls and Quartermaster. The company serves more than one million customers per year through its websites, catalog, inside and outside sales forces and nine retail service center locations. The company was founded in 1968 and is based in Lexington, KY (www.galls.com).

“We are pleased to announce the acquisition of Roy Tailors Uniform Co. Roy Tailors is a leader in the Ohio market and has distinguished itself through excellent service in its stores. We are excited to build on the company’s success by pairing it with Galls’ breadth of product, national distribution capabilities, catalog and web presence, and premier information technology infrastructure,” said Michael Wessner, chief executive officer of Galls.

CI Capital Partners invests from $25 million to $100 million in middle market companies in the following sectors: business services, consumer services, distribution, government services and defense, and light manufacturing. Since the firm’s inception in 1993, CI Capital and its portfolio companies have made more than 100 acquisitions representing over $6 billion in enterprise value. CI Capital’s existing portfolio consists of companies which collectively generate annual revenue of approximately $4 billion, EBITDA of approximately $350 million, and employ approximately 15,000 people. The firm is based in New York (www.cicapllc.com).

© 2013 PEPD • Private Equity’s Leading News Magazine • 9-26-13

AIP Acquires Flow International

by

flow nfFlow International Corporation, a developer and manufacturer of industrial waterjet machines for cutting and cleaning applications, today announced that it has entered into an agreement to be acquired by American Industrial Partners in a transaction valued in excess of $200 million. Under the terms of the agreement, American Industrial Partners will acquire all of the outstanding shares of Flow common stock for $4.05 per share in cash. This value represents an 11.3 times multiple of trailing four quarter reported EBITDA, which was $17.8 million as of July 31, 2013. The transaction is expected to close in early 2014.

Flow International Corporation (Nasdaq:FLOW) is a developer and manufacturer of industrial waterjet machines for cutting and cleaning applications used in multiple industries including automotive, aerospace, job shop, surface preparation, and more. The company is based in Kent, WA (www.FlowWaterjet.com).

“I am pleased to announce this agreement, which maximizes value for all of our shareholders. This transaction represents a successful conclusion to our extensive ‘strategic alternatives’ investigation, during which the company contacted many strategic and financial partners,” said Charley Brown, President and CEO of Flow. “In AIP, we have a partner with a strong reputation and proven record of success, who understands the potential of Flow’s waterjet solutions and has the resources and expertise to help accelerate our growth plans. We believe this transaction appropriately recognizes the value of Flow’s technology and customer relationships, while providing our stockholders with a meaningful cash premium for their investment.”

American Industrial Partners invests in North American headquartered industrial companies with sales ranging from $100 million to $500 million. The firm was founded in 1989 and is currently managing more than $1.1 billion in equity capital. American Industrial Partners is based in New York (www.americanindustrial.com).

“We are excited about this agreement with Flow, which is known throughout its industry for its innovative waterjet technology. We have been impressed by the company’s capabilities and its strong relationships with its global customer base. We will work with the Flow management team to continue investing in the company’s technology to grow the waterjet share of the worldwide cutting market,” said Richard Hoffman, partner of AIP.

The transaction has fully committed financing and is not subject to any condition with regard to the financing.

UBS Investment Bank is serving as Flow’s financial advisor and K&L Gates is serving as legal counsel. Houlihan Lokey is serving as AIP’s financial advisor and Ropes & Gray and Baker Botts are serving as co-legal counsel.

© 2013 PEPD • Private Equity’s Leading News Magazine • 9-26-13

TVV Capital Acquires Pitonyak Machinery

by

pmc nfBigham Brothers, a portfolio company of TVV Capital, has acquired Pitonyak Machinery Corporation, a manufacturer of agricultural implements. TVV acquired Bigham Brothers in late 2012.

Pitonyak Machinery Corporation (PMC) is a branded manufacturer of agricultural implements, including grain carts, Hipper Rollers®, Hipper Choppers®, land levelers, field rollers and quick hitches, each designed and manufactured to be the heaviest, most durable equipment of its kind. The company also manufactures a variety of construction equipment and accessories, including loader forks, box scrapers and utility levelers for landscaping and lot maintenance. PMC’s products are available via its dealer network. PMC was founded in 1913 and is based in Carlisle, AR (c).

Bigham Brothers manufactures agricultural tillage and cultivating equipment for the sustainable agricultural market. The company’s products are marketed through the Bigham and Lilliston brands and available via a network of approximately 1,400 independent dealers and co-operatives. The company was founded in 1933 and is based in Lubbock, TX (www.bighamag.com).

A benefit of the add-on acquisition includes giving Bigham access to an additional, centrally located manufacturing facility. Together, the two Bigham factories will be able to supply a nationwide network of dealers, servicing the major agricultural regions of the United States. All products, which are designed for commercial farm operators, will be marketed under the Bigham brand. PMC’s products, such as its Hipper Chopper and GCX Grain Carts, which have historically been sold primarily in the Mid-South region, are complementary and counter-seasonal to Bigham’s existing product lines.

“The acquisition of PMC is a reflection of TVV’s continued expertise in directly sourcing and closing deals in the niche manufacturing industry,” said Andrew Byrd, President of TVV Capital. “In the particular case of PMC, it highlights our ability to scout deals that also aid in the rapid expansion of an existing portfolio company. Bigham is currently benefiting from growth that’s driven by superior products and the implementation of lean manufacturing practices. When combined with favorable market conditions, such as expanding farm incomes and increasing crop demand, the addition of PMC fully supports Bigham’s growth-through-acquisition strategy.”

TVV Capital is a lower middle-market buyout firm focused on acquiring market-leading niche manufacturers in defensive, recession-resistant sectors with strong succession management in place and identifiable growth prospects. TVV targets companies with enterprise values from $10 million to $100 million, EBITDA margins of 10 to 25 percent, and which are characterized by positive and stable cash flows, consistent profitability, and leverageable assets. TVV Capital was founded in 1997 and is headquartered in Nashville (www.tvvcapital.com).

Legal advisors on this transaction for TVV Capital were Bass, Berry & Sims of Nashville and accounting services were provided by DGLF CPAs and Business Advisors of Nashville.

© 2013 PEPD • Private Equity’s Leading News Magazine • 9-26-13

To search in site, type your keyword and hit enter