Archives for November 2013

Cortec Group Acquires Weiman Products

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Cortec Group has acquired Weiman Products, a provider of specialty cleaning products. Cortec invested in Weiman through its fifth fund, Cortec Group Fund V, L.P., and is the fund’s fifth platform investment.

“The entire team at Weiman is thrilled to be teaming with Cortec as we enter our next phase of growth. They bring to the table a unique blend of consumer and healthcare investing experience that will undoubtedly allow us to hit the ground running,” said Carl DeMasi, Weiman’s President and CEO.

Mr. DeMasi and the rest of the senior management team will continue in their current roles and as shareholders in the company.

Weiman is a provider of branded specialty cleaning products for the consumer market and specialty cleaning, sterilization and disinfectant products for the healthcare market. Weiman’s consumer division produces, markets and distributes over 50 formulations of branded specialty household cleaning products, all sold under the Weiman or Wright’s brand names, that address distinct cleaning needs within home, appliance, furniture and other specialty categories. The company’s consumer products are sold through retailers in the global mass, food, drug, specialty and e-Commerce channels, covering over 50,000 retail doors. The company’s healthcare division develops and manufactures over 60 healthcare formulas, consisting of detergents, instrument care solutions, high level disinfectants for processing surgical instruments, and general surface disinfection products. The company’s healthcare products are used in the acute, physician, dental and veterinary healthcare markets and are sold to the channel OEMs and distributors. Weiman Products was founded in 1963 and is based near Chicago in Gurnee, IL (www.weiman.com).

“Weiman has built an outstanding long-term track record under Carl DeMasi’s leadership, evidenced by 32 consecutive years of sales growth. The company’s consistent strong performance is directly attributable to the Weiman brand’s reputation for quality, efficacy and value among a broad range of consumers,” said David Schnadig, a Managing Partner at Cortec.

Cortec Group invests in middle-market specialty manufacturing, service, healthcare and distribution businesses with enterprise values of $40 million to $300 million. Cortec currently manages over $1 billion in its two active funds. The firm was founded in 1984 and is based in New York (www.cortecgroup.com).

“Weiman’s historical growth has been impressive, but Cortec is even more excited about the company’s future prospects. Through development of innovative products, expansion into adjacent channels and acquisitions, we believe the company is poised for accelerated growth and are looking forward to partnering with the Weiman team,” said Jeffrey Shannon, a Managing Director at Cortec.

Duff & Phelps Securities served as financial advisor to Weiman.

© 2013 PEPD • Private Equity’s Leading News Magazine • 11-26-13

Audax Acquires Haverhill Cable and Manufacturing

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Winchester Electronics Corporation, a portfolio company of Audax Private Equity, has acquired Haverhill Cable and Manufacturing.

Haverhill Cable and Manufacturing is a producer of semi-rigid coaxial cable and cable assemblies. Its products are utilized in a variety of microwave and RF systems in commercial, military, and satellite equipment. The company is headquartered in Haverhill, MA (www.haverhillcable.com).

Winchester is a designer and manufacturer of connectors and cable assemblies used in the medical, military, energy & power, broadcast and ruggedized industrial end markets. The company is based in Middlebury, CT (www.winchesterelectronics.com).

Audax acquired Winchester in June 2006 and with the buy of Haverhill Cable has now completed eight add-on acquisitions including: Continental Connector Company (Hatfield, PA) in May of 2013; Clements National Company (Broadview, IL) in August of 2012; Electrical Specialty Products (Spartanburg, SC) in July of 2012; Kings Electronics Corporation (Rock Hill, SC) in May of 2007; and Advanced Interconnect (Franklin, MA) in April of 2007.

The Audax Group makes control investments of $10 million to $100 million in middle market companies with transaction values of $25 million to $500 million. Sectors of interest include industrial manufacturing; energy; outsourced industrial services; consumer products; healthcare devices and services; non-asset based logistics; technology; aerospace & defense; business services; and direct marketing. The firm was founded in 1999 and has offices in Boston and New York (www.audaxgroup.com).

© 2013 PEPD • Private Equity’s Leading News Magazine • 11-26-13

TA Associates Acquires Accruent

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TA Associates has completed a majority investment in Accruent, a provider of real estate and facilities management software. Existing investor Vista Equity Partners, which first invested in Accruent in December 2009, will retain a significant ownership position.

Accruent provides market planning, site selection, project management, lease administration, facilities and space management software that is purpose-built for specific industries. Over the last four years, Accruent has completed four strategic acquisitions to become the largest independent provider of real estate and facilities software. The customer base has grown from 400 to over 1,200 customers that use the company’s software in 56 countries. The company was founded in 1995 and is headquartered in Austin, TX and has offices in Santa Monica, CA; Evanston, IL; Calgary, AB, Canada and Columbus, OH (www.accruent.com).

“We’ve been tracking the evolution and growth of this category for years and Accruent has clearly emerged as the market leader,” said Hythem El-Nazer, a Director at TA Associates who will join the company’s Board of Directors. “It is a very well-run company and we are excited to support the team’s current strategy and direction. We look forward to partnering with management and Vista Equity to build on Accruent’s success.”

TA Associates makes buyouts and minority recapitalizations of profitable growth companies in the technology, financial services, business services, healthcare and consumer industries. Since founding in 1968, TA has invested in over 430 companies globally and has raised more than $18 billion in capital. The firm was founded in 1968 and has offices in Boston, Menlo Park, London, Mumbai and Hong Kong (www.ta.com).

“Real Estate, Facilities and Site Management represent a large component of enterprise spend and a huge strategic lever,” said Jason Werlin, a Principal at TA Associates who will also join the company’s Board of Directors. “The market is fragmented and, until recently, solutions were either painful to implement or incomplete. Accruent’s ability to deliver enterprise class solutions with the ease of cloud deployment is a tremendous opportunity for organizations to unlock value by managing real estate assets in a more strategic manner.”

Vista Equity Partners has more than $7 billion in committed capital and makes equity investments in enterprise software businesses and technology-enabled services companies. The firm was founded in 2000 and has over 50 investment professionals operating out of Austin, Chicago, and San Francisco (www.vistaequitypartners.com).

“Our four-year partnership with Vista Equity Partners allowed us to transform our company and products,” said Mark Friedman, Founder and CEO of Accruent. “Our new partnership with TA Associates allows us to stay private and focused on our current strategy while leveraging TA’s global scale and deep industry expertise to provide our customers with even more long-term value.”

© 2013 PEPD • Private Equity’s Leading News Magazine • 11-26-13

KPS Closes on Furniture Brands, Appoints New CEO

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KPS Capital Partners has formed Heritage Home Group and completed the acquisition of substantially all of the assets of Furniture Brands International, a designer, manufacturer, and retailer of home furnishings. Heritage Home Group acquired the assets as part of a sale process under Section 363 of the United States Bankruptcy Code.

Furniture Brands International (OTC: FBNIQ) is a home furnishings company with brands that include Broyhill, Lane, Thomasville, Drexel Heritage, Henredon, Hickory Chair, Pearson, Laneventure, and Maitland-Smith. The company’s products are sold through a range of channels, including the company’s own Thomasville retail stores and through interior designers, multi-line/independent retailers and mass merchant stores. The company was founded in 1911 and is based in Clayton, MO (www.furniturebrands.com).

With the closing of the acquisition, KPS has named Ira Glazer as President and Chief Executive Officer of Heritage Home Group.

“This is the beginning of a new era for Heritage Home Group and its brands. The company has a new owner, a new CEO, a new Board of Directors and a new strategic direction,” said Raquel Vargas Palmer, a Partner of KPS. “Heritage Home Group launches with truly iconic brands, a solid financial structure and access to KPS’ financial resources and expertise. We strongly believe in the fundamental value of this business and the significant growth potential that can be unlocked through focused investment in our brands.”

Mr. Glazer is an executive with three decades of successful turnaround experience. He is the former president and CEO of Kansas City-based WireCo World Group, a wire rope company, which was acquired by KPS in 2002 and sold to Fox Paine & Company in 2007.

“I am honored to lead Heritage Home Group. Free of Furniture Brands’ burdens and liabilities, and with a rock-solid balance sheet and many outstanding associates who are joining our company, we have an exceptional opportunity to build a true industry leader,” said Mr. Glazer. “I am also pleased to partner and collaborate again with KPS, a firm that has distinguished itself as a global leader in turnaround investing and is ideally suited for this exciting venture.

GE Capital and PNC Bank provided financing for the transaction. Proskauer Rose acted as legal counsel to KPS.

KPS Capital Partners is the manager of the KPS Special Situations Funds, a group of private equity funds with over $6 billion of committed capital focused on investing in restructurings, turnarounds and other special situations. The KPS investment strategy targets manufacturing and industrial companies with strong market positions that are going through a period of transition or experiencing operating or financial difficulties. The firm’s portfolio companies have aggregate annual revenues of approximately $7.6 billion, operate 87 manufacturing plants in 25 countries, and employ over 31,000 associates worldwide. KPS Capital Partners is headquartered in New York (www.kpsfund.com).

© 2013 PEPD • Private Equity’s Leading News Magazine • 11-26-13

Nexxus Closes on $550 Million for its Sixth Fund

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Nexxus Capital has held a final closing of its sixth institutional private equity fund, Nexxus Capital VI, with capital commitments of $550 million. The new fund was oversubscribed and exceeded its original target of $400 million.

Pension plans, sovereign wealth funds, and endowments from North America, Europe and the Middle East account for the majority of the investor base. The new fund will make equity investments in midsize companies primarily in Mexico, where there is an opportunity to institutionalize family or entrepreneurially owned businesses.

Nexxus Capital is the oldest independent Mexican private equity firm with more than 18 years in the market. The team has a successful track record achieving unleveraged gross IRRs of over 25%, with over $1.2 billion in assets under management plus $100 million in co‐investments across six institutional funds. Nexxus Capital is headquartered in Mexico City (www.nexxuscapital.com).

Nexxus VI is comprised of two investment vehicles: a Mexican public vehicle listed on the Mexican Stock Exchange (Ticker: NEXX6CK 13) and an Ontario limited partnership. Both vehicles will co‐invest on a pro‐rata basis according to total available resources of each vehicle.

MVision Private Equity Advisers acted as lead global fundraising adviser. Santander and Citigroup acted as joint‐bookrunners for the Mexican vehicle.

© 2013 PEPD • Private Equity’s Leading News Magazine • 11-26-13

Penfund Backs OMERS Buy of Caliber Collision

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Penfund has provided a $60 million 2nd lien loan to Caliber Collision Centers which was recently acquired by OMERS Private Equity.

Caliber is a provider of automotive collision repair services with a network of 157 collision centers located in California, Texas, Arizona, Nevada, Oklahoma and Colorado. The company has approximately 3,700 employees and repairs more than 285,000 vehicles annually. Caliber is headquartered in Dallas (www.calibercollision.com).

Penfund specializes in providing junior capital to middle market companies throughout North America. The firm provides second lien, high yield and mezzanine debt, control and minority equity, as well as bridge facilities, standby lines, underwritten facilities and financial guarantees. Penfund is currently investing out of Penfund Capital Fund IV which has $460 million of committed capital. The firm was founded in 1979 and is based in Toronto (www.penfund.com).

“We are delighted to have been able to support OMERS’s acquisition of Caliber. We are also very pleased to continue our long association with Caliber. We believe Caliber’s exceptional management team will continue to rapidly grow the business with the backing of the human and financial resources of OMERS,” said Jeremy Thompson, a partner at Penfund. “This growth will be underpinned by the intensifying desire of automobile insurers to rely on the ability of large, efficient and trustworthy repair center operators to deliver high quality services to their policy holders.”

OMERS Private Equity manages the private equity activities of OMERS, one of Canada’s largest pension funds. The group’s investment strategy includes the active ownership of businesses in North America and Europe. Sectors of interest include manufacturing, financial and business services, industrial and consumer products, transportation, and technology. Investment sizes range from $100 million to $500 million. The firm is located in Toronto with offices in New York and London and has $6 billion of investments under management (www.omerspe.com).

“We are thrilled to partner with Steve Grimshaw, President and CEO of Caliber, and his management team for the company’s next phase of growth,” said Tim Patterson, Senior Managing Director at OMERS. “We believe that Caliber will continue to distinguish itself as the market leader in the highly fragmented collision repair industry in the years ahead.”

© 2013 PEPD • Private Equity’s Leading News Magazine • 11-26-13

Fireman Capital Partners Acquires Skip Hop

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Fireman Capital Partners has acquired a majority stake in Skip Hop, a provider of infant and toddler products and accessories. Skip Hop founders Michael and Ellen Diamant will retain a meaningful ownership stake, and will continue to lead the company.

Skip Hop is a cross-category lifestyle brand serving the infant and toddler industry with both soft and hard line products. Products include diaper bags, on-the-go accessories, soft & wooden toys, bedding, bath time, feeding, and the ZOO line of toddler products. The company’s products are sold at over 4,000 retail locations in the US and in over 60 countries worldwide. Skip Hop was founded in 2003 by husband and wife team Michael and Ellen Diamant and is headquartered in New York (www.skiphop.com).

“Ellen and I – and the rest of the Skip Hop team – are thrilled to be partnering with Fireman Capital Partners,” said Mr. Diamant. “FCP has a proven track record in the consumer space, and their vision for Skip Hop is perfectly aligned with ours. We are very excited to have the resources and added experience to help take Skip Hop to the next level – all while retaining our focus on making great product.”

“We look forward to collaborating with Michael and Ellen to support the further development and growth of Skip Hop. The company has tremendous momentum. We plan to leverage our resources and operational expertise to assist Skip Hop in accelerating the build of the company’s product platform and distribution,” said Marla Sabo, Partner at Fireman Capital.

Fireman Capital Partners (FCP) was established in 2008 under Chairman Paul Fireman and Managing Partner Dan Fireman. The firm invests in consumer products companies with revenues between $20 million and $150 million. The firm is based in Boston (www.firemancapital.com).

“Skip Hop creates truly innovative products that are original, fresh and with a contemporary aesthetic. While successfully expanding its product suite and distribution channels, Skip Hop has proven the strength of its brand and the authenticity of its products. We are delighted to be partnering with this dynamic company,” said Dan Fireman, Managing Partner of FCP.

McDermott Will & Emery acted as legal advisor to Fireman Capital Partners. ROTH Capital Partners provided financial advice to Skip Hop, and Goodwin Procter acted as legal advisor.

© 2013 PEPD • Private Equity’s Leading News Magazine • 11-25-13

Aurora Capital Group Exits Porex Corporation

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Aurora Capital Group has completed the sale of Porex Corporation, a developer of porous polymer materials, to Filtration Group. Aurora first invested in Porex in October 2009.

Porex is a developer of porous polymer materials used in the healthcare and bioscience end markets, and also in the consumer and industrial sectors. Porex products serve filtration, venting, wicking, diffusion, and media support functions in applications such as blood filters, catheter vents, fuel filters, writing instrument tips, and consumable diagnostic tests. The company has more than 1,300 customers across 65 countries. Porex was founded in 1961 and has operations in North America, Europe and Asia. The company is headquartered in Fairburn, GA (www.porex.com).

Under Aurora’s ownership, Porex made a number of strategic acquisitions and divestitures, including the sale of Porex’s surgical division to Stryker Corporation in November 2010.

“Aurora’s investment in Porex exemplifies our investment strategy and the spirit of partnership we bring to our work,” said Michael Marino, Partner of Aurora Capital Group. “The seamless collaboration between Aurora, Porex and the company’s independent board underpinned the success of an ambitious set of investment initiatives designed to grow Porex’s capabilities and its unique materials technology. As a result of these initiatives and several strategic transactions, Porex has evolved to become a larger, stronger and more innovative company. The entire Porex organization, led by President and CEO Bill Midgette, has done a tremendous job building this business, and we believe the company is very well-positioned to continue on its exciting trajectory with Filtration Group.”

The buyer of Porex, Filtration Group, provides filtration products and services used by customers in the food & beverage; water, micro-electronics & telecommunications; environmental air; medical & bioscience; hydraulics; mining & minerals; industrial finishing and energy industries. The company operates facilities in 20 countries under three operating divisions: Liquid/Process, Environmental Air and Fluid. Filtration Group is headquartered in Chicago (www.filtrationgroup.com).

“Aurora, and the board it put in place, have been incredible partners during a transformational period of growth for Porex. As a result of Aurora’s investment and support, we have elevated our performance, delivering our technology to world-class customers around the globe with record levels of innovation, speed and quality. Looking ahead, we are excited to partner with Filtration Group as we continue to expand our market-leading capabilities in porous polymer technology,” said William Midgette, President and Chief Executive Officer of Porex.

Aurora Capital focuses principally on control investments in middle-market industrial, manufacturing and service oriented businesses. The firm, founded in 1991, has $2 billion of capital under management and is headquartered in Los Angeles (www.auroracap.com).

Robert W. Baird & Co. acted as financial advisor to Porex.

© 2013 PEPD • Private Equity’s Leading News Magazine • 11-25-13

Shore Capital Partners Exits SCP Specialty Infusion

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Shore Capital Partners has sold SCP Specialty Infusion, a home infusion services company, to AxelaCare Health Solutions, a portfolio company of Excellere Partners. The transaction closed on October 31, 2013.

Infusion services primarily involve the intravenous (i.e., directly into veins or muscles, or under the skin) administration of medications to treat a range of acute and chronic health conditions. Physicians and hospitals generally refer patients to specialty infusion providers to continue their therapies at home or in other non-acute settings. The market for specialty infusion is approximately $10 billion and growing at approximately 8% to 12% annually.

SCP Specialty Infusion was created in November 2009 when Shore Capital Partners teamed with Chris York, CEO, and Mitch Friedman, CFO, both home infusion industry veterans, to complete a roll-up strategy in the space. In July 2010, the management team and Shore made their platform investment in Arizona-based Sirona Infusion. Over the next three and a half years, Shore and management completed three add-on acquisitions and built three de novo pharmacies. Shore and management integrated these regionally diverse companies by standardizing operations with weekly and monthly metric management and a unified IT platform. Shore and management also consolidated HR, corporate compliance, accounting and finance.

Today, SCP Specialty Infusion is a provider of acute home infusion services in the Western US. Its network of pharmacies, infusion centers, and nursing staff spans Arizona, New Mexico, California, Colorado, and Oregon. Therapies delivered include the full spectrum of acute and chronic infusion therapies including anti-infective, oncolytic, total parenteral nutrition, cardiac, hydration, and other intravenously delivered medicines. The company is based in Chandler, AZ (www.sironainfusion.com).

“Over the last three and a half years, we’ve built a company on the model of putting the patient first,” said Chris York, CEO of SCP Specialty Infusion. “We are confident that this model, combined with aggressive business development and an intense focus on metric management, enabled us to build a scarce asset in the home infusion industry. Shore’s operational oversight and financial support coupled with management’s industry expertise were highly complementary and helped facilitate the platform’s growth.”

Shore Capital Partners invests in lower middle market healthcare related companies that have $5 million to $50 million of revenue and $1 million to $5 million of EBITDA. Healthcare sectors of particular interest include behavioral health; healthcare staffing; infusion therapy; laboratory products & distribution; laboratory services; outpatient rehab therapy; urgent care; veterinary services; pharmaceutical services/contract research. Shore has completed 11 investments across the home infusion, lab services, physical therapy, and urgent care sectors. The firm was founded in 2009 and is based in Chicago (www.shorecp.com).

“We are pleased to have partnered with management to build SCP Specialty Infusion into one of the preeminent home infusion providers in the country,” said Justin Ishbia, Founder and Managing Partner of Shore Capital Partners. “Further, the successful execution of our value creation plan has allowed us to complete the sale of SCP Specialty Infusion on favorable terms for our investors.”

AxelaCare, acquired by Excellere Partners in December 2010, is a provider of home infusion therapy services, including Intravenous Immune Globulin, Hemophilia and other traditional home infusion services, such as Intravenous Antibiotics and Total Parenteral Nutrition. The company currently operates three pharmacies serving patients in 25 states. AxelaCare is headquartered in Lenexa, KS (www.axelacare.com).

Excellere Partners invests in middle-market companies with revenues ranging from $20 million to $150 million. Sectors of interest include healthcare; specialty foods; industrial technology and services; business services; and education and training. The firm has $737 million of capital under management and is based in Denver, CO (www.excellerepartners.com).

© 2013 PEPD • Private Equity’s Leading News Magazine • 11-25-13

Carlyle Closes Fund 6 Above Target at $13 Billion

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The Carlyle Group has held a final close of Carlyle Partners VI, a $13 billion fund that invests in US corporate buyouts and strategic minority investments across six industries. Two hundred sixty-nine investors from 43 countries committed capital to the fund. Carlyle began fundraising in late 2011 with a $10 billion target.

Demonstrating alignment with fund investors and confidence in the team, Carlyle, its senior professionals, operating executives, other professionals and advisors committed $1 billion in capital alongside Carlyle Partners VI fund investors, who committed $12 billion.

“We are grateful for the support of our fund investors, many of whom are repeat investors. Institutional and individual investors across the globe understand the value of having a proven buyout fund in their portfolio. We will take good care of their money as we work to invest wisely and create value,” said Allan Holt, Managing Director and Co-head of the US Buyout Group.

The US Buyout Group is part of Carlyle’s Corporate Private Equity segment, the oldest and largest of the firm’s four business segments, with assets under management of $62 billion as of September 30, 2013. Corporate Private Equity, with 262 investment professionals, operates 14 fund families worldwide with more than 150 portfolio companies as of September 30, 2013. The US Buyout Group specializes in six industry sectors: aerospace, defense & government services; consumer & retail; healthcare; industrial & transportation; telecommunications & media; and technology.

“Our deep and experienced industry investment teams continue to identify attractive investment opportunities. Combining that industry knowledge with Carlyle’s 27 Operating Executives and global network creates a powerful platform for value creation for our fund investors,” said Peter Clare, Managing Director and Co-head of the US Buyout Group. “Growth drives most of our value creation and we have built the capabilities necessary to find and accelerate real growth.”

Carlyle’s previous US buyout fund, the $13.7 billion Carlyle Partners V, closed at the end of 2008.

The Carlyle Group invests in buyouts, growth capital, real estate and leveraged finance in Africa, Asia, Australia, Europe, North America and South America. The firm employs 1,450 people in 34 offices across six continents and is based in Washington, DC (www.carlyle.com).

© 2013 PEPD • Private Equity’s Leading News Magazine • 11-25-13

OMERS Acquires Caliber Collision Centers

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OMERS Private Equity has acquired Caliber Collision Centers from private equity firm ONCAP, Onex Corporation’s mid-market private equity platform.

Caliber is a provider of automotive collision repair services with a network of 157 collision centers located in California, Texas, Arizona, Nevada, Oklahoma and Colorado. The company has approximately 3,700 employees and repairs more than 285,000 vehicles annually. Caliber is headquartered in Dallas (www.calibercollision.com).

“We are thrilled to partner with Steve Grimshaw, President and CEO of Caliber, and his management team for the company’s next phase of growth,” said Tim Patterson, Senior Managing Director at OPE. “We believe that Caliber will continue to distinguish itself as the market leader in the highly fragmented collision repair industry in the years ahead.”

OMERS Private Equity manages the private equity activities of OMERS, one of Canada’s largest pension funds. The group’s investment strategy includes the active ownership of businesses in North America and Europe. Sectors of interest include manufacturing, financial and business services, industrial and consumer products, transportation, and technology. Investment sizes range from $100 million to $500 million. The firm is located in Toronto with offices in New York and London and has $6 billion of investments under management (www.omerspe.com).

Onex Corporation makes private equity investments through the Onex Partners and the ONCAP families of funds. Onex has more than $16 billion of assets under management and is based in Toronto with additional offices in New York and London (www.onex.com).

BB&T Capital Markets served as financial advisor to Caliber and ONCAP in the transaction. The sale of Caliber represents BB&T Capital Markets’ fifth sale of a major collision repair chain in the last five years.

© 2013 PEPD • Private Equity’s Leading News Magazine • 11-22-13

J.F. Lehman Exits Northeast Ship Repair

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J.F. Lehman & Company has sold its portfolio company, Northeast Ship Repair, to Plexus Capital and NewSpring Capital. J.F. Lehman & Company acquired Northeast Ship Repair in 2008.

Northeast Ship Repair is a provider of large vessel maintenance, repair and overhaul services for the US Government non-combatant fleet and commercial customers. With facilities in Boston and Philadelphia, Northeast Ship Repair operates two of the dry-docks on the East and Gulf Coasts capable of servicing vessels in excess of 750 feet in length (www.northeastship.com).

“We are very pleased to sell Northeast Ship Repair to Plexus and NewSpring,” said Alex Harman, Partner at J.F. Lehman. “Northeast Ship Repair President Ed Snyder and his team have done a fantastic job growing the business in partnership with us over the last five years. We appreciate the fine efforts of all involved and are confident that Plexus and NewSpring have acquired a great platform for future growth.”

J.F. Lehman & Company is a middle-market private equity firm focused primarily on the maritime, defense, and aerospace sectors. The firm was founded by Dr. John Lehman, who served six years as Secretary of the United States Navy. To date, J.F. Lehman has made investments in companies with an aggregate transaction value of approximately $1.6 billion. The firm was founded in 1992 and is headquartered in New York with additional offices in Washington, DC and London (www.jflpartners.com).

Plexus invests from $1 million to $20 million of subordinated debt and equity in companies that have revenues of at least $15 million and cash flows of at least $2 million. Sectors of interest include business services; consumer services; healthcare; manufacturing; value-add distribution and other general industry. Plexus Capital operates as a licensed SBIC with approximately $550 million of capital under management across three funds. The firm was founded in 2005 has offices in Charlotte and Raleigh, NC (www.plexuscap.com).

NewSpring Capital is a family of private equity funds providing growth equity and mezzanine capital. The firm has offices in Radnor, PA; Short Hills, NJ; Washington, DC; and Baltimore, MD (www.newspringcapital.com).

Lincoln International (www.lincolninternational.com) provided M&A advisory services to J.F. Lehman in connection with the transaction.

© 2013 PEPD • Private Equity’s Leading News Magazine • 11-22-13

TriWest Capital Partners Exits RTL-Westcan

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TriWest Capital Partners has sold its portfolio company RTL-Westcan to strategic buyer Kenan Advantage Group. TriWest first invested in RTL-Robinson Enterprises in September 2006. The company then merged with Westcan Bulk Transport in May 2007 to create the largest bulk commodity hauler in Western Canada.

RTL-Westcan specializes in the transportation of liquid and dry bulk commodities, including fuel, asphalt, ammonia, fertilizers, grains, ethanol, salt, sulfur and lime. The company serves the energy, mining, agriculture and infrastructure end markets. RTL-Westcan was founded in 1964 and is headquartered in Edmonton, Canada and operates out of 14 locations throughout Alberta, British Columbia, Saskatchewan and the Northwest Territories (www.westcanbulk.ca).

Kenan Advantage Group (KAG) is a tank truck hauler and logistics provider, transporting fuel, chemicals and food-grade products. The company has five operating groups consisting of the Fuels Delivery Group, Specialty Products Group, Merchant Gas Group, Logistics Group and KAG Canadian Group. KAG’s fleet consists of approximately 6,200 power units and 9,700 trailers. KAG also provides specialized supply chain logistics services through KAG Logistics and KAG Ethanol Logistics. The company is headquartered in North Canton, OH (www.thekag.com) (www.kaglogistics.com).

KAG funded the acquisition of RTL-Westcan with interim borrowings under its senior secured credit facility. KAG intends to refinance a portion of its senior secured credit facility with US and Canadian dollar term loans and unsecured high yield notes.

TriWest invests in companies with operating earnings or EBITDA in the range of $10 million to $50 million. Sectors of interest include service, manufacturing and distribution. The firm has raised $775 million in committed capital through four funds and has invested in 27 companies to date. TriWest was founded in 1998 and is based in Calgary, Alberta (www.triwest.ca).

Harris Williams & Co. (www.harriswilliams.com) acted as an advisor to RTL-Westcan. The transaction was led by Frank Mountcastle, Jason Bass, Joe Conner, Jershon Jones and Jeff Kidd from Harris Williams & Co.’s Transportation & Logistics (T&L) Group.

“RTL-Westcan has built an impressive platform for bulk hauling in Western Canada. The geographic areas served by the company represent some of the fastest growing regions in North America,” said Mr. Mountcastle, a managing director in Harris Williams & Co.’s T&L Group. “This partnership will enable RTL-Westcan to continue to execute its growth strategy while also providing KAG with a strategic platform to continue its expansion into new geographies and new markets in North America. This transaction is a great outcome for all parties involved.”

© 2013 PEPD • Private Equity’s Leading News Magazine • 11-22-13

Calvert Street Acquires Oilfield Tubular Inspection

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Inspection Oilfield Services, a portfolio company of Calvert Street Capital Partners, has acquired Oilfield Tubular Inspection. Calvert Street first invested in Inspection Oilfield Services in January 2011.

Oilfield Tubular Inspection (OTI) provides mobile, on-site inspection, testing and cleaning services of oil country tubular goods and drill tools. The company is based in Woodward, OK (no website found).

Inspection Oilfield Services (IOS) provides non-destructive testing, inspection, threading, storage, cleaning and repair services for tubular products and tools used in oil and gas drilling and production. The company is based in Houston, TX (www.iosinspection.com).

“The acquisition of OTI represents another highly strategic addition to the IOS platform, deepening our presence and service offerings in the Mid Continent region and, more generally, further diversifying the company’s capabilities, customer base and growth opportunities,” said Brian Guerin, Partner at Calvert Street.

Calvert Street makes control investments in niche manufacturing and business services companies that have a minimum of $5 million of EBITDA and are located in the US or Canada. The firm is based in Baltimore (www.cscp.com).

© 2013 PEPD • Private Equity’s Leading News Magazine • 11-22-13

Azalea Acquires Century Turbine Repair

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Orbital Tool Technologies, a portfolio company of Azalea Capital, has acquired Century Turbine Repair. This is the second add-on acquisition that Azalea has completed for Orbital Tool since acquiring the company in July 2012.

Century Turbine Repair provides inspection, repair, and maintenance services for steam turbines and related rotating equipment operated by utilities, municipal power plants, and industrial companies. The company can perform work on large turbine components (up to 50 tons in-house and 75 tons in the field). Century Turbine was founded in 2007 and is headquartered near St. Louis in Pevely, MO (www.centuryturbinerepair.com).

Orbital Tool Technologies (OTT) performs inspections, in-house fabrication and on-site machining and repair services of component parts used in the generation of electricity by utilities operating in the US nuclear, fossil, hydro-electric and wind industries. The company also serves the pulp and paper, municipal power, and turbine/valve OEM industries. OTT uses field technicians, field service equipment, and portable machine shops to handle both planned outages and emergency work. OTT also offers optical and laser alignment, reverse engineering and steam turbine replacement parts. The company is was founded in 1996 and headquartered in Belvidere, IL (www.orbitaltool.com).

“Orbital Tool’s experience in field machining, spare parts fabrication, and valve repairs, combined with Century’s capabilities in steam path inspection and repairs will offer the utility and industrial markets a sole source provider for the vast majority of their rotating equipment maintenance needs,” said Century Founder Bill Huey.

Azalea Capital invests in middle market companies that have annual revenues of $10 million to $100 million and EBITDAs of $2 million to $10 million that are located in the Southeastern US. Industries of interest include manufacturing, business services, consumer products, pet products and services, value-added distribution, and healthcare. The firm is currently investing out of it third fund, Azalea Fund III, LP. Azalea Capital was founded in 1996 and is headquartered in Greenville, SC (www.azaleacapital.com).

© 2013 PEPD • Private Equity’s Leading News Magazine • 11-22-13

Heading the Right Way Slowly

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Middle-market deal volume and valuations continue to pick up steam in the third quarter of 2013, according to GF Data’s November 2013 report.

The 181 private equity firms that are active contributors to GF Data reported 34 completed transactions in the third quarter, up from 17 in 1Q and 22 in 2Q. (GF Data reports on transactions completed in the $10 million to $250 million Total Enterprise Value (TEV) range at multiples of 3-12x Trailing Twelve Months (TTM) Adjusted EBITDA.)

Valuations averaged 6.6x trailing twelve months (TTM) Adjusted EBITDA in the third quarter, up slightly from 6.5x in 2Q and well above the 5.9x mark recorded in 1Q.

“We continue to see the scarcity of product push valuations upward,” said Andrew Greenberg, GF Data’s CEO. “And the rise is being fairly widely felt across major sectors. Multiples are up in health care services, business services and distribution while aggregate multiples are flat in manufacturing. Subscribers using our searchable data base will find strength in selected niches. For example, while the overall average for the year to date is 5.8x, in computer and electronic products, the average is 7.9x.”

The rise in valuation is even greater for more attractive businesses, noted B. Graeme Frazier, IV, GF Data Principal and Co-Founder. “Selling businesses with above average EBITDA margins and revenue growth traded at an average of 7.0x in the year to date,” said Mr. Frazier. “For other firms the average is 5.7x.”

“The third quarter data reflects a “perfect storm” of high public company values, under-levered balance sheets, massive and rapidly expiring private equity overhang and inexpensive debt capital. The intersection of these factors has created very high demand for what is currently a limited supply of sellers,” said Mike McGill, founder and Managing Director of investment bank MHT MidSpan.

In the November report, GF Data also debuted the more granular debt data the firm began collecting earlier this year. This includes not only reporting on aggregate debt loads, but the data can now be crosscut based on several transaction features. For example, while aggregate total debt in 2013 year-to-date is 3.6x EBITDA, in transactions at or close to maximum available leverage the figure is 4.2x.

GF Data provides reliable external information for use in valuing and assessing M&A transactions to private equity firms, investors, lenders and other users. GF Data collects and publishes proprietary transaction information from private equity groups on a blind and confidential basis. Two hundred and thirteen private equity firms have provided information on deals included in the latest report. Data contributors and paid subscribers receive three products: high-level valuation and leverage data; key deal-term data on indemnification, escrow and basket benchmarks; and continuous access, through GF Data’s secure website, to detailed valuation data organized by NAICS code.

For information on subscribing or on contributing data as a private equity participant, please contact Bob Wegbreit at [email protected] or 610-260-6263.

© 2013 PEPD • Private Equity’s Leading News Magazine • 11-22-13

Dave Calhoun Joins Blackstone to Head Private Equity Portfolio Operations

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Blackstone announced today that David Calhoun, the CEO of Nielsen Holdings, will join Blackstone as a Senior Managing Director and Head of Private Equity Portfolio Operations.

Mr. Calhoun will oversee a team of 21 professionals within the portfolio operations group which partners with portfolio company CEOs to drive value creation initiatives. He will also be a member of Blackstone’s Management and Executive Committees. Mr. Calhoun will report to Joseph Baratta, Blackstone’s Global Head of Private Equity.

“The key to continuing to generate outstanding returns for our investors is to drive transformational change in our portfolio companies,” said Mr. Baratta. “Dave’s thirty-year career as an operator of some of the world’s leading companies will greatly enhance our ability to help our portfolio company CEOs transform and grow their businesses. As the former CEO of one of our largest and most successful portfolio companies, Dave knows our team well and how to unlock value in private equity-backed companies.”

Mr. Calhoun joined Nielsen in 2006, shortly after the company was acquired by a consortium of private equity investors including Blackstone. He led the transformation of the company into a world leading marketing information services company. During Mr. Calhoun’s tenure at Nielsen the company’s operating income improved from $800 million at the time of the acquisition to $1.7 billion in 2012 with a compound annual growth rate of 13%. Mr. Calhoun serves on the Board of Nielsen and will become Executive Chairman in January 2014. He also sits on the Boards of Directors of The Boeing Company and Caterpillar.

Before joining Nielsen, Mr. Calhoun served as Vice Chairman of The General Electric Company and President and Chief Executive Officer of GE Infrastructure, the company’s largest business unit. During his twenty-six-year tenure at GE, Dave ran multiple business units, including GE Lighting, GE Employers Reinsurance Co., GE Aircraft Engines, and GE Transportation.

“We are delighted to be able to work more closely with Dave Calhoun, as he joins our team at Blackstone. He is one of the most talented CEOs we have ever worked with. We are excited to have him help guide our portfolio company operations as well as the strategic development of Blackstone itself,” said Stephen Schwarzman, Chairman, CEO and Co-Founder of Blackstone.

Blackstone is one of the world’s leading investment and advisory firms. The firm’s alternative asset management businesses include the management of private equity funds, real estate funds, hedge fund solutions, credit-focused funds and closed-end funds. Blackstone also provides various financial advisory services, including financial and strategic advisory, restructuring and reorganization advisory and fund placement services. Blackstone is based in New York (www.blackstone.com).

“I am thrilled to be joining Blackstone. They are a recognized leader in the private equity industry and they have been an important contributor to The Nielsen Company’s success,” said Mr. Calhoun. “I look forward to working with our portfolio company CEOs in every way I know how to build better companies and create added value for our fund investors.”

© 2013 PEPD • Private Equity’s Leading News Magazine • 11-22-13

J.F. Lehman Exits Drew Marine and ACR Electronics

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J.F. Lehman & Company has sold its portfolio company Drew Marine, a provider of maritime services, to The Jordan Company. Concurrent with the sale of Drew Marine, J.F. Lehman also sold its portfolio company ACR Electronics to The Jordan Company.

Drew Marine, acquired by J.F. Lehman from Ashland Inc. in August 2009, is a supplier of marine water treatment, maintenance, welding and refrigeration, fuel treatment and fire, safety and rescue products and services to ship owners, ship managers and shipyards. The company is headquartered in Whippany, NJ and employs approximately 325 people (www.drew-marine.com).

Since acquiring Drew Marine in 2009, J.F. Lehman worked with the company’s management team to reinvigorate Drew Marine’s core business of providing global maritime customers (representing over 11,000 ocean-going vessels) with products and services across approximately 1,000 port locations in 50 countries around the world. These organic growth initiatives were augmented by two add-on acquisitions which increased Drew Marine’s product portfolio, customer base and distribution channels.

“We are proud of the profitable growth and expansion that Drew Marine has achieved over the past four years,” said Len Gelosa, President and Chief Executive Officer of Drew Marine. “J.F. Lehman has been instrumental in helping solidify our reputation and brand portfolio, expand our capabilities through organic growth and acquisition, improve our infrastructure and recruit key talent to our team. We look forward to continuing this momentum under The Jordan Company.”

“Our successful partnership with management since 2009 enabled Drew Marine to firmly establish a proven track record as an industry leader. In addition, the sale of Drew Marine represents an excellent outcome for our investors, whose support has been essential to our organization’s continuing success,” said Louis Mintz, Chairman of Drew Marine and a Partner at J.F. Lehman.

Simultaneous with the sale of Drew Marine, J.F. Lehman also sold its portfolio company ACR Electronics to The Jordan Company. ACR Electronics, acquired by J.F. Lehman in July 2012, is a provider of safety and survival products including emergency rescue beacons and safety and signaling lighting to aviation, marine, military and outdoor recreation markets worldwide. The company is headquartered in Ft. Lauderdale, FL (www.acrelectronics.com).

J.F. Lehman & Company is a middle-market private equity firm focused primarily on the maritime, defense, and aerospace sectors. The firm was founded by Dr. John Lehman, who served six years as Secretary of the United States Navy. To date, J.F. Lehman has made investments in companies with an aggregate transaction value of approximately $1.6 billion. The firm was founded in 1992 and is headquartered in New York with additional offices in Washington, DC and London (www.jflpartners.com).

The Jordan Company is a middle-market private equity firm with over $6 billion of assets under management. The firm is headquartered in New York and has offices in Chicago and Shanghai (www.thejordancompany.com).

Evercore Group and Rothschild served as financial advisors to J.F. Lehman and Jones Day provided legal counsel.

© 2013 PEPD • Private Equity’s Leading News Magazine • 11-20-13