Prospect Partners and Schilling Ventures have acquired Cyclonaire, a provider of pneumatic conveying systems. Cyclonaire is the seventh platform company in Prospect Partners’ $200 million third fund and the third investment for Schilling Ventures.
Cyclonaire provides custom-engineered and manufactured pneumatic conveying systems for the transfer of dry bulk materials including cement, chemicals, food, minerals, petrochemicals, proppants (used in hydraulic fracturing) and sand. The company’s products are used in railcar unloading, locomotive track sanding, dust collection, automation, batching and blending, and aeration systems. Cyclonaire will continue to be led by Jerry Elfring, President, who has been with the company almost since its inception in 1973. Cyclonaire is headquartered near Lincoln in York, NE (www.cyclonaire.com).
“Prospect Partners and Schilling Ventures felt like the right fit from the start,” said Mr. Elfring. “They fully embrace our emphasis on top-quality equipment, design integrity, and exceptional customer service. We look forward to their support and guidance as we grow our core business and expand into new markets. We are excited about what the future holds for Cyclonaire.”
“With a stellar reputation, a superb management team, specialized technology, and significant continued growth potential, Cyclonaire stands out as a market leader in the fragmented pneumatic conveying industry,” said Maneesh Chawla, a Principal at Prospect Partners.
With the purchase of Cyclonaire, Prospect and Schilling are now seeking add-on acquisitions of other pneumatic conveying and material handling companies as well as manufacturing automation and controls businesses. “We look forward to supporting management in building a larger company in the broader material handling space and to partnering with Schilling Ventures, a skilled operator with a focus on lean manufacturing initiatives,” said Mr. Chawla.
Prospect Partners focuses exclusively on management-led leveraged recapitalizations and acquisitions of niche market leaders with revenues of less than $75 million. Since 1998, Prospect Partners has invested nationwide in more than 105 companies in a range of niche manufacturing, distribution, and specialty service markets. The firm has $470 million of capital under management and is based in Chicago with an additional office in Menlo Park (www.prospect-partners.com).
Schilling Ventures invests in companies that have revenues of $2 million to $20 million and EBITDAs of $500,000 to $5 million. Sectors of interest include non-automotive transportation, building products, material handling, food, water treatment, and energy components. The firm is headquartered in the Chicago suburb of Naperville (www.schillingventures.com).
© 2014 PEPD • Private Equity’s Leading News Magazine • 1-8-14