Archives for December 6, 2013

Goldner Hawn Acquires Kerick Valve

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Control Devices, a portfolio company of Goldner Hawn Johnson & Morrison, has acquired Kerick Valve, a manufacturer of PVC float valves.

Kerick Valve is a manufacturer of PVC float valves and related components that are used in a variety of industrial and agricultural applications including cooling towers, irrigation and water treatment, livestock and animal watering, and commercial ice-making equipment. Kerick Valve is based in Jacksonville, FL (www.floatvalve.com).

“Kerick Valve is a name synonymous with the highest quality, made-in-America PVC float valves, and its product line is highly complementary to Control Devices’ existing broad line of Bob® and Bobby® branded industrial float valves. We look forward to upholding Kerick Valve’s reputation as a high-quality and highly responsive supplier to the industrial and agricultural trade,” said Control Devices’ CEO, Chris FitzGerald.

Control Devices designs and manufactures engineered flow control products. The company offers customized and standard valves, nozzles and accessories, condensate traps, refrigerant distributors and other products that serve as components in end-product applications including pressure washers, air compressors, fire suppression systems, specialty gas systems, HVACR, and heavy truck braking systems. Control Devices was acquired by Goldner Hawn in August 2013 and is based in Fenton, MO (www.cdivalve.com).

“We are pleased to support the Control Devices management team in yet another excellent acquisition,” said Goldner Hawn Managing Director, Jason Brass.

Goldner Hawn Johnson & Morrison invests from $10 million to $25 million in companies located in the upper Midwest that have enterprise values from $20 million to $150 million. Sectors of interest include food manufacturing and distribution, consumer products, business services, transportation and niche manufacturing. The firm was founded in 1989 and is based in Minneapolis (www.ghjm.com).

Dallas-based investment bank Generational Equity (www.genequityco.com) represented Kerick Valve in this transaction. Managing Director Don Sawyer led the Generational Equity deal team.

© 2013 PEPD • Private Equity’s Leading News Magazine • 12-6-13

Resilience Acquires Liquids Division of oneCare

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Resilience Capital Partners has agreed to acquire the assets of the Liquids division of oneCARE (Liquids). The operations of Liquids will be integrated with Resilience’s existing portfolio company CR Brands.

This is Resilience Capital Partners’ first add-on acquisition by its CR Brands platform which it acquired in September 2012. The acquisition of Liquids doubles the number of brands the CR Brands now offers. Acquired brands include the leading brand in home dry cleaning, Dryel, as well as a variety of drain pipe opening solutions including Roto-Rooter and Drain Pro.

“The combination of CR Brands and the oneCARE assets result in a single company that has tremendous breadth in laundry and specialty cleaning coupled with greater manufacturing scale, deeper product development expertise, and expanded trade-reach,” said Bassem Mansour, Co-CEO of Resilience Capital Partners.

CR Brands manufactures and markets both branded and private label household cleaning and laundry products. The company’s branded products are marketed under the brands Mean Green, Biz, Oxydol, Pine Power and Magnum Power. CR Brands has national distribution with retailers such as Dollar General, Family Dollar, Walmart, Target and Kroger. The company has also partnered with certain customers (Kroger, Publix) to manufacture proprietary store brand household cleaning products. The company is based in West Chester, OH (www.crbrandsinc.com).

“In our industry, a strong pipeline of innovative products is the key to success. This acquisition really raises our game in that area – as it doubles the number of branded items we bring to the trade, and more than doubles the product development resources needed to drive innovation on those brands,” said CR Brands’ Chief Executive Officer, Rich Owen.

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 33 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 • 12-6-13

Audax Acquires Radius Power and LCR Electronics

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Astrodyne Corporation, a portfolio company of Audax Private Equity, has completed the acquisitions of Radius Power and the EMI/RFI filters and electronic controls division of LCR Electronics (LCR).

The acquisitions of Radius and LCR expand the operations of Astrodyne into the EMI and RFI filters segment of the power electronics components manufacturing industry. EMI and RFI filters are passive electronic devices used to suppress conducted interference present on any power or signal line. These filters may be used to suppress the interference generated by the device itself as well as to suppress the interference generated by other equipment.

Radius is a designer and manufacturer of EMI and RFI filters primarily for the telecom, semi-conductor, industrial, and military end markets. The company is headquartered in Yorba Linda, CA (www.radiuspower.com).

LCR designs and manufactures EMI and RFI filters primarily for the industrial, military/aerospace, and white goods end markets. The company is headquartered in Norristown, PA (www.lcr-inc.com).

Astrodyne Corporation is a designer, manufacturer, and distributor of AC/DC power supplies, DC/DC converters, and external and wall-mount power adapters through catalog, direct sales, and internet. With operations in the United States, China, and Taiwan, the company serves industrial, audio/visual, medical, instrumentation, and distribution end markets. Audax Group acquired Astrodyne from American Capital Strategies in April 2008. With the purchases of Radius and LCR, Astrodyne has now completed four add-on acquisitions, including, RO Associates (March 2010) and Jerome Industries (May 2011). Astrodyne is headquartered in Mansfield, MA (www.astrodyne.com).

“Astrodyne is a global developer and manufacturer of specialized power solutions for demanding applications. The acquisitions of Radius and LCR expand Astrodyne’s product offering to include a comprehensive line of EMI and RFI filters. We will continue to work with CEO Peter Kaczmarek to execute a growth strategy focused on new product introductions, geographic expansion, and strategic add-on acquisitions,” said Oliver Ewald, Managing Director of Audax Private Equity.

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 • 12-6-13

Comvest Backs Universal Marine Medical Supply

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Comvest Partners, through its lending platform, Comvest Capital, has provided a $21.5 million term loan facility with additional $10.0 million of availability to Universal Marine Medical Supply International (Universal). The Comvest credit facility was utilized to recapitalize the previous buyout of the founding shareholder and for further acquisition and growth capital.

Universal is a supplier of medical and pharmaceutical supplies to cruise ships, oil rigs, super yachts, merchant vessels, tankers, and freighters. The company was founded in 1976 by Jules Nasso and is based in Manhattan and Staten Island, NY, with operational hubs in Florida, the UK and Greece (www.universalmarinemedical.com).

“We are very excited about our partnership with Comvest.” said Drew Schaefer, Chairman and co-CEO of Universal. “The facility allows us maximum flexibility to address our growing international organization.”

The Comvest Group provides debt and equity to middle-market companies. For debt investments the firm will invest from $2 million to $20 million per transaction in companies with $10 million to $200 million of revenue that have positive or negative EBITDA. For equity investments the firm will invest from $10 million to $50 million per transaction in companies with $15 million to $500 million of revenue that have positive or negative EBITDA. Since 2000, Comvest has invested more than $1.7 billion of capital in over 120 public and private companies worldwide. The firm is based in West Palm Beach (www.comvest.com).

“Universal is a well positioned business serving the specialized needs of the maritime industry,” said Greg Reynolds, Managing Director, Comvest Partners. “We are pleased to partner with Universal’s experienced and talented management team to accelerate the growth of their business”.

Universal was advised on this transaction by New York based investment bank The Seaport Group (www.theseaportgroup.com).

© 2013 PEPD • Private Equity’s Leading News Magazine • 12-6-13

Higher Valuations, Good Performance Lift IPO Market

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The surge in IPO volume in 2013 can be attributed to a significant increase in investor demand based on the performance of recently completed IPOs, according to Fitch Ratings. Higher valuations also helped boost the number of IPO transactions this year.

An increase in IPOs could be beneficial for many speculative grade issuers as the equity market has become another favorable source of capital to be used for debt repayment and leverage reduction. While conditions for speculative grade borrowers remain favorable, access to funding for high yield companies via IPO transactions has clearly become less difficult.

The average IPO has returned nearly 34% from its IPO price, according to Renaissance Capital which also reports that a total of 210 IPO pricings have taken place thus far in 2013, making it one of the busiest years post-crisis based on the number of filings.

According to Fitch, the median aggregate market valuation multiple for speculative-grade companies increased by 13% to 9.17x as of October 20, 2013 since the end of 2012 after increasing 7% to 8.11x in 2012. If this level holds through 2013, it would be the highest median multiple in the last 10 years.

Private equity firms that had portfolio companies that were unable to be sold or monetized due to the financial crisis have been able to exit and return value back to their investors through new equity offerings. Historically, the IPO window for speculative-grade borrowers has been fleeting, but current market conditions support credit, making it a logical choice for companies seeking to refinance. Hilton Worldwide’s recently announced $2.4 billion IPO filing could make the Blackstone Group-owned unit the third largest private equity-backed IPO on record and the largest private equity-based IPO in 2013.

Despite the rebound in the IPO market in 2013, the number of IPO filings is nowhere near its pre-dotcom bubble levels. However, if favorable capital market conditions persist, Fitch expects IPO volume to continue to trend higher.

© 2013 PEPD • Private Equity’s Leading News Magazine • 12-6-13

Hemali Dassani Joins Castle Harlan

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Castle Harlan has appointed Hemali Dassani as its new Director, Investor Relations. Ms. Dassani will also oversee the firm’s marketing efforts.

“Hemali’s appointment reflects her track record of success in working with alternative investment firms, especially private equity funds, to raise capital globally,” said Howard Morgan, Co-President of Castle Harlan. “Her expertise and experience will be invaluable when we launch our next fund.”

Before joining Castle Harlan, Ms. Dassani was a Managing Director with Old City Investment Partners, a multi-family office investment firm. She holds an MBA from Harvard Business School and a BSc in Industrial Engineering from Northwestern University. Ms. Dassani is President of the Harvard Business School Club of Greater New York, and sits on the Board of Governors for the Harvard Business School Real Estate Alumni Association and the Steering Committee for the Harvard Business School Alumni Angels Association.

Castle Harlan invests in controlling interests in the buyout and development of middle-market companies in North America, Europe and, together with CHAMP Private Equity, in Australia. Since its inception, Castle Harlan has invested in more than 53 companies representing more than $11 billion in enterprise value. The firm was founded in 1987 and is based in New York (www.castleharlan.com).

© 2013 PEPD • Private Equity’s Leading News Magazine • 12-6-13