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Archives for May 2014

TCF Backs Iron Range Buy of Aircraft Propeller Services

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tcf nfTCF Capital Funding has provided $15.5 million in secured financing to support the acquisition of Aircraft Propeller Services by Iron Range Capital Partners.

Aircraft Propeller Services (APS) provides maintenance, repair & overhaul (MRO) services for aircraft propeller used in the regional, commercial, freight, military and general aviation markets.  APS has 58 employees at its 30,000 square foot repair facility and headquarters located near Chicago in Wheeling, IL.  APS was founded in 1956 (www.aircraftpropeller.com).

Dan Delgadillo nf1“We are excited to support Iron Range’s investment in APS,” said TCF Capital Funding Vice President Dan Delgadillo.  “APS has exhibited strong growth and a leading position within its niche market and is well-positioned to continue to expand.”

Iron Range Capital invests in lower middle market companies with EBITDAs between $3 million and $20 million. Sectors of interest include niche manufacturing, business services, and value-added distribution businesses. The firm was founded in 2013 by Gary Stark and is based in Chicago (www.ironrangecapital.com).

“We are very excited to partner with Mark Grant, the CEO of APS, and the rest of APS team,” said Gary Stark, managing partner of Iron Range Capital Partners.  “We see great potential in the aviation MRO space and look forward to helping APS capitalize on this significant market opportunity by leveraging APS’s core strengths and providing the company resources to execute a profitable growth strategy.”

TCF Capital Funding provides asset-based loans and private equity sponsor-backed cash flow loans to companies with less than $100 million in revenue and between $2 million and $10 million in EBITDA.  The firm is led by Joseph Gaffigan, President, and is based just outside Chicago in Burr Ridge, IL (www.tcfcapitalfunding.com).

© 2014 PEPD • Private Equity’s Leading News Magazine • 5-5-14

The Gores Group Acquires Hovis

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hovis nf1The Gores Group and Premier Foods have completed a joint venture transaction whereby Gores will acquire a 51% stake in Hovis, Premier Foods’ bread business.  Hovis is one of the largest bakery brands in the UK and amongst the best known food brands in the country.  Premier Foods will maintain a 49% ownership interest in the joint venture.

Hovis is an iconic UK brand of flour and bread that was founded in 1886. Hovis also makes Mothers Pride, Ormo and other retail branded bakery products and supplies flour to a range of customers under the brand names Rank Hovis, Fleming Howden and Holgran.  The company employs approximately 3,800 people at 10 bakeries, 6 flour mills and 2 regional distribution centers across the UK.  Hovis is headquartered northwest of London in High Wycombe, UK (www.hovisbakery.co.uk).

goni nf1“We believe there is significant untapped potential in such a well-loved, household name and are confident in the abilities of the talented management team to drive value for all stakeholders. The Gores Group has a rich history of working alongside corporate partners to unlock latent value in divisions that require operational and commercial improvement and, as such, we are convinced that Hovis offers a perfect fit for our unique capabilities,” said Fernando Goni, Managing Director at The Gores Group.

Gores will pay £30 million for a 51% controlling stake in the joint venture, of which £15m is deferred and contingent on future business performance.  Gores and Premier Foods have further agreed to support Hovis with a combined commitment of up to £45 million for the period after completion and under certain conditions. This investment, together with external financing and cash flow from the business, would be used to invest approximately £200 million over the next five years to improve Hovis’ operational infrastructure and reinvigorate the brand.

“I’m delighted that we’ve found a strong partner in The Gores Group who will help provide the investment necessary to develop the bread business,” said Gavin Darby, Chief Executive Officer of Premier Foods.  “This will be good for our customers, our employees and all those connected with the business. A joint venture arrangement also means we will share in the future gains from this investment as the business continues its return to profitable growth, helping us maximize value creation.”

The Gores Group makes control investments in non-core, underperforming or undervalued businesses in the United States and Europe. The firm maintains an in-house team of over 60 M&A and operations professionals in the US and Europe. The Gores Group was founded in 1987 and is headquartered in Los Angeles with additional offices in Boulder, CO and London, UK (www.gores.com).

© 2014 PEPD • Private Equity’s Leading News Magazine • 5-1-14

Genstar to Acquire Pretium Packaging

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Pretium nf1Genstar Capital has signed an agreement to acquire Pretium Packaging, a manufacturer of rigid plastic bottles and containers, from Castle Harlan which first invested in the company in February 2010.  The transaction is expected to close in June 2014.

golde nf1“Pretium represents an outstanding investment opportunity for Genstar that fits well with our investment thesis for the packaging industry,” said David Golde, who leads Genstar’s packaging-related investing efforts.  “We are attracted to Pretium’s long-standing commitment to innovation, customer service and manufacturing excellence that has created strong customer relationships and provides the runway for continued growth.  We are excited to be working with the senior management team at Pretium as we share a similar vision to pursue an active acquisition strategy and invest in strategic initiatives.”

Pretium Packaging is one of the nation’s largest manufacturers of customized, high performance rigid plastic bottles and containers. The company has capabilities in all major resin types and manufacturing processes and is primarily focused on customers with small-to-medium volume requirements. Pretium sells its products to a customer base of over 750 accounts, ranging from Fortune 500 companies to smaller privately-owned businesses in the food & specialty beverage, private label, pharmaceutical, personal care and household & industrial sectors.  The company operates 11 manufacturing facilities, nine in the United States and two in Canada and has approximately 1,000 employees.  Pretium is headquartered near St. Louis in Chesterfield, MO (www.pretiumpkg.com).

rutledge nf1“Pretium represents a premier platform that advances our investment approach in the industrial technology vertical and within packaging,” said Rob Rutledge, who leads Genstar’s industrial technology vertical.  “We will continue to seek investment opportunities similar to Pretium that benefit from the attractive secular trends driving growth in the packaging industry.”

Genstar Capital invests from $50 million to $400 million in middle-market companies that have enterprise values from $50 million to $1 billion and EBITDAs greater than $15 million. Sectors of interest include life sciences, healthcare services, software & software services, financial services, and industrial technology. The firm was founded in 1988 and is based in San Francisco (www.gencap.com).

pruellage nf2“The past four years have been an excellent and rewarding partnership with Pretium’s management team. The company has realized a number of strategic and operational initiatives and is well positioned for continued growth,” said Castle Harlan Co-President Bill Pruellage.

Castle Harlan makes control investments in 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 54 companies representing more than $11 billion in enterprise value. The firm was founded in 1987 and is based in New York (www.castleharlan.com).

Citigroup Global Markets acted as exclusive financial advisor to Pretium, and Schulte Roth & Zabel acted as the company’s legal advisor. Weil, Gotshal & Manges acted as legal advisor to Genstar.

© 2014 PEPD • Private Equity’s Leading News Magazine • 5-1-14

Nova Sells Debro Chemicals to 4I Capital

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debro nf1Nova Capital Management has sold its portfolio company Debro Chemicals to 4I Capital.  Nova acquired Debro in 2011 as part of a portfolio of five industrial businesses it acquired from Amalgamated Metal Corporation.

Debro Chemicals is a distributor of specialty chemicals. The company operates through four business units: Fine Chemicals, Process Chemicals, Food Ingredients and Industrial Specialties.  Debro is headquartered in Brampton, Ontario and has additional offices in Dorval, Quebec and Richmond, BC (www.debro.com).

jones nf1“This exit is in line with the portfolio strategy we envisaged at the time of the acquisition from Amalgamated Metal and will enable us to concentrate our resources on the remaining two companies in this portfolio over the coming years,” said Kath Jones, an Investment Partner at Nova.

Nova Capital Management has acquired or taken over the management of private equity portfolios representing a total transactional value of some $1.7 billion. The firm currently manages investments in 29 businesses primarily operating in Western Europe and North America, across a range of sectors. The firm was founded in 2002 and has offices in London, Chicago and Toronto (www.nova-cap.com).

The buyer of Debro Chemicals, 4I Capital, is a Toronto-based private investment company headed by Brian Imrie.

“I am pleased to return Debro to Canadian ownership,” said Mr. Imrie.  “Debro is one of the leading, independent chemical distributors in Canada and we have an outstanding employee team lead by Bill Heise.  Debro represents many of the best chemical companies in the world and serves a diverse and growing customer base across Canada. I look forward to working with the Debro team, our suppliers and customers and to celebrating Debro’s centennial in 2020 and for many years beyond.”

© 2014 PEPD • Private Equity’s Leading News Magazine • 5-1-14

Kamylon Capital Exits FeraDyne Outdoors

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feradyne nf2Kamylon Capital has sold its portfolio company FeraDyne Outdoors, a maker of bow-hunting accessories, to Snow Phipps Group.

FeraDyne Outdoors designs, manufactures and sells a range of outdoors product brands in the bow-hunting and bow-fishing industries. The company’s brands include Rage Broadheads, RageCage Quiver, Nockturnal, Muzzy Broadheads and Tru-Fire. Feradyne Outdoors is headquartered in Cartersville, GA with an additional location in Fond du Lac, WI (www.ragebroadheads.com) (www.nockturnal.com) (www.muzzy.com) (www.trufire.com).

“Our work building FeraDyne from the ground up is quintessential Kamylon,” said Charles Lelon, founder and chief executive of Kamylon. “The success of FeraDyne is further evidence of the power of Kamylon’s managerial investment culture: where managers act like investors and investors act like managers.”

Since acquiring FeraDyne in 2011, Kamylon originated and integrated three add-on acquisitions, developed and introduced more than twenty products into the market, and executed several continuous improvement programs and initiatives that reduced costs and improved product quality.

“Kamylon Capital did a terrific job in helping us identify and acquire the high-quality companies and brands within the FeraDyne platform. Kamylon’s in-depth business systems and processes greatly assisted management in optimizing results company-wide. The Kamylon team personified teamwork, professionalism, integrity and a bias for action. It was a tremendous partner,” said Richard Krause, Chief Executive Officer of FeraDyne.

Kamylon Capital makes control equity investments in lower middle market businesses that have $8 million to $80 million in sales and $1 million to $8 million in cash flow.  Sectors of interest include healthcare, wellness products and services, branded niche consumer products, media & information services, aviation products & services, transportation & logistics, specialty manufacturing, education & training, and business services.  The firm is based near Boston in Wellesley Hills, MA (www.kamylon.com).

Snow Phipps makes control investments in companies primarily located in North America with enterprise values ranging from $100 million to $500 million that require equity investments ranging between $40 million and $100 million. The firm has $1.5 billion of assets under management and was co-founded by Ian Snow and Ogden Phipps in April 2005. Snow Phipps is headquartered in New York (www.snowphipps.com).

Kamylon was advised by investment bank Robert W. Baird & Co. DLA Piper provided transaction and general legal counsel, and Covington & Burling served as intellectual property counsel.

© 2014 PEPD • Private Equity’s Leading News Magazine • 5-1-14

Levine Leichtman Completes Buy of FMC Material Handling

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fmc2 nfFMC Technologies has completed the divestiture of its material handling products business to Syntron Material Handling, a new platform company formed by Levine Leichtman Capital Partners.

With the transaction closed, Syntron Material Handling is now a manufacturer of conveyor and vibratory equipment used to load, transport and feed bulk materials. Products are sold to customers throughout the world in the mining, aggregates, packaging and food industries. Syntron is headquartered in Tupelo, MS and has operations in Changshu, China and Salt Lake City, UT (no website found).

Senior debt financing was provided by CIT Finance (as Sole Lead Arranger, Sole Lead Bookrunner and Sole Administrative Agent), Siemens Financial Services (as Syndication Agent) and Ares Capital Corporation (as Documentation Agent).

Levine Leichtman Capital Partners manages approximately $7 billion of capital through private equity partnerships, distressed debt and leveraged loan funds. The firm is currently making new investments through Levine Leichtman Capital Partners V, LP; Levine Leichtman Capital Partners SBIC Fund, LP; and Levine Leichtman Capital Partners Private Capital Solutions II, LP. The firm is based in Los Angeles with offices in Chicago, Dallas, New York and London (www.llcp.com).

© 2014 PEPD • Private Equity’s Leading News Magazine • 5-1-14

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