April 13, 2015
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Archives for April 13, 2015

Triton Pacific Exits Columbia Medical

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Columbia Medical Manufacturing, a portfolio company of Triton Pacific Capital Partners that develops and markets pediatric rehabilitation products, has been acquired by medical equipment manufacturer Drive Medical.

This was a successful investment for Triton Pacific.  During the term of ownership it received distributions from cash flow in excess of its investment prior to the sale – and, together with the sale proceeds, have generated a return of more than three times the original investment.

Columbia develops and markets a variety of assistive products such as wheelchairs, aircraft transfer chairs, bath and shower products, and car seats that are used by children with disabilities and their families to engage in the activities of daily living in a safe and productive manner.  The company was founded in 1978 by scientist and inventor Dr. Michael Caan and is headquartered in Santa Fe Springs, CA (www.columbiamedical.com).

“We collaborated with management to meet our objectives of building a robust product development team, implementing a lower cost manufacturing process, and expanding the distribution channel. Columbia’s success couldn’t help but attract the attention of a large and growing company such as Drive,” said Craig Faggen, CEO of Triton Pacific. “Drive is in an excellent position, with the addition of Columbia, to realize its vision of expanding its presence in the pediatric market.”

Drive Medical manufactures durable medical equipment including mobility products, beds, bariatric products, wheelchairs, sleep surfaces and pressure prevention products, respiratory equipment, self-assist products, power operated wheelchairs, rehabilitation products, patient room equipment, personal care products and electrotherapy devices. The company is headquartered on Long Island in Port Washington, NY and has offices and distribution facilities in the United States, Canada, the United Kingdom, France, Germany, Romania, Australia, China and Taiwan (www.drivemedical.com).

Triton Pacific Capital Partners invests from $5 million to $15 million in US-based middle-market companies that are active in the healthcare services, financial services, business services, software, restaurants, and light manufacturing sectors. Target companies will have $2 million to $10 million of EBITDA. Larger companies can be pursued that have EBITDAs of up to $30 million with established co-investors.  The firm was founded in 2001 and is headquartered in Los Angeles (www.tritonpacific.com).

© 2015 PEPD • Private Equity’s Leading News Magazine • 4-13-15

Inverness Graham Exits AdvancedCath

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Inverness Graham has completed the sale of AdvancedCath, a designer and manufacturer of catheter systems, to publicly traded TE Connectivity Ltd. (NYSE: TEL) for $190 million in cash.

AdvancedCath designs and manufactures catheter systems that are used in OEM medical devices.  The AdvancedCath platform was created by Inverness Graham in January 2011 with the initial acquisition of TechDevice, a manufacturer of catheters and components.  Later, Inverness Graham added on Medical Profiles and Engineering (June 2011); AdvancedCath Technologies (October 2013) and LSA Laser (September 2014) to complete the platform build. TechDevice rebranded itself as AdvancedCath in January 2014. The company has facilities in Boston (Watertown), MA; Eden Prairie, MN; Plymouth, MN; San Jose, CA; and San Rafael, Costa Rica (www.advancedcathetermanufacturing.com).

“Over the course of our hold, we executed a significant strategic transformation at AdvancedCath, taking the company from a Boston-based manufacturer of guidewires and related components to a global player in the outsourced design and manufacture of a full range of advanced catheter systems including catheters, guidewires, and balloons for complex interventional applications,” said Scott Kehoe, Managing Principal of Inverness Graham. “Through both organic and acquisitive initiatives and the recruitment of a world-class management team, we fulfilled our vision of building a leading advanced catheter systems solution provider, growing the top and bottom line by over three times and making AdvancedCath a very attractive target for strategic acquisition, exceeding our expectations.”

Inverness Graham invests in lower middle market value-added manufacturing and service companies with revenues from $10 million to $50 million, EBITDA’s between $3 million and $10 million, and enterprise values of $20 million to $100 million. The firm manages $250 million in capital commitments and was formed by senior executives of the Graham Group, an industrial and investment concern with interests in plastics, packaging, recycling, building products and outsourced manufacturing. Inverness Graham is based near Philadelphia in Newtown Square, PA (www.invernessgraham.com).

“Inverness Graham was a great partner in every sense of the word,” said Randall Sword, CEO of AdvancedCath. “They supported us in making a series of strategic moves that enabled the company to grow significantly over the past four years, allowing us to deliver best-in-class advanced catheter systems expertise to our global medical device OEM customers. We are pleased with what we have accomplished with Inverness Graham and look forward to the next chapter as part of TE’s Medical business unit.”

The sale of AdvancedCath is the fourth portfolio company exit for Inverness Graham in just over one year.

© 2015 PEPD • Private Equity’s Leading News Magazine • 4-13-15

EQT Acquires WASH from CHS

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EQT Partners, through its EQT Infrastructure II Fund, has agreed to acquire WASH Multifamily Laundry Systems – the largest Canadian provider and second largest US provider of route-based laundry services to multifamily apartments and universities – from CHS Capital.

CHS Capital acquired WASH (then Web Service Company) in September 2008. Today, the company operates through 26 branch locations with an installed base of over 500,000 machines at 70,000 locations.  To service these facilities, the WASH utilizes a fleet of approximately 600 satellite enabled vehicles. WASH has approximately 880 employees and is headquartered in El Segundo, CA.  The company was founded in 1947 and more than 4.5 million people do their laundry in a WASH laundry room every week (www.washlaundry.com).

The management team of WASH, led by CEO Adam Coffey, will remain with the company and continue to run the business under the ownership of EQT.

“WASH’s current management has taken a family-owned company, with a strong heritage and long history of providing essential services to its customers, and transformed the business into a technology-driven platform that is a true leader in the industry. We have followed the company for some time and have been impressed by WASH’s stable earnings base, defensible market position, and multiple growth avenues. WASH is exactly the type of company in which EQT Infrastructure seeks to invest and this acquisition is a continuation of EQT Infrastructure’s investment strategy in North America. We look forward to working together with WASH’s management and employees, along with a board of Industrial Advisors, to apply EQT’s growth-oriented approach to value creation and take WASH to the next level,” says Stefan Glevén, Partner at EQT Partners.

EQT Partners pursues medium sized companies in Northern Europe, Eastern Europe, China and the US. EQT Infrastructure II is a EUR 1.9 billion fund investing in medium-sized infrastructure businesses in the Nordic region, parts of Continental Europe, and North America. Investment targets are regulated infrastructure, concession-based infrastructure, market-based infrastructure and services businesses with infrastructure characteristics.  EQT Partners is based in Stockholm with other offices in Copenhagen, Helsinki, Oslo, Frankfurt, Munich, New York, Shanghai, Hong Kong and Warsaw (www.eqt.se).

The acquisition of WASH represents EQT’s sixth investment in North America and the second investment in a North American route-based infrastructure services business.

The seller of WASH, CHS Capital (formerly Code Hennessy & Simmons) targets companies with enterprise values between $75 million and $500 million. Industries of interest include business & consumer services; distribution; industrial products; infrastructure; and energy.  The firm is headquartered in Chicago (www.chsonline.com).

EQT was advised by Weil, Gotshal & Manges, Bain & Company and KPMG.  WASH was advised by Moelis & Company, William Blair & Co., and Kirkland & Ellis.

Financing for the transaction will be provided by Morgan Stanley, Goldman Sachs, and Natixis.

© 2015 PEPD • Private Equity’s Leading News Magazine • 4-13-15

Audax Acquires Medical Measurement Systems

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LABORIE Medical Technologies, a portfolio company of The Audax Group, has acquired Medical Measurement Systems a developer and distributor of medical diagnostic systems.

“This is a very strategic acquisition for LABORIE,” said Brian Ellacott, LABORIE President and CEO.  “MMS has developed user-friendly products based on a unique platform that simultaneously supports urology and gastroenterology customers. We see tremendous opportunities to leverage this single platform across all our products and extend our global reach through the MMS global distribution network.  We see this as a very complementary acquisition.”

Medical Measurement Systems (MMS) is a developer and distributor of medical diagnostic systems used in urodynamics and gastroenterology.  In the urodynamic field (the investigation of the function of the lower urinary tract – the bladder and urethra) MMS markets a complete line of diagnostic equipment including wireless uroflowmeters and multi-channel video-urodynamic systems. The equipment is used to diagnose bladder dysfunctions, micturition disorders, urinary and fecal incontinence as well as prostate problems.  In the gastroenterology field, MMS sells a line of ambulatory and stationary equipment used to measure and diagnose non-cardiac chest pain, swallow disorders, reflux, EGG and motor abnormalities for the oesophagus, stomach, small bowel, colon and anorectal canal.  MMS is headquartered in Enschede, The Netherlands, with a German subsidiary in Bottrop and US operations in Dover, NH (www.mmsinternational.com).

LABORIE, acquired by Audax in August 2012, is a developer, manufacturer and marketer of medical technology and consumables for the diagnosis and treatment of urinary and fecal Incontinence, as well as other pelvic floor disorders in the urology, gynecology, and colorectal fields. Customers include physician offices, hospitals, and mobile medical services providers.  The company is headquartered in Toronto (www.laborie.com).

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.  Audax has over $6 billion in assets under management in its private equity, mezzanine, and senior debt businesses. The firm was founded in 1999 and has offices in Boston and New York (www.audaxgroup.com).

© 2015 PEPD • Private Equity’s Leading News Magazine • 4-13-15

Victory Park Invests in Katy

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Victory Park Capital has provided Katy Industries with a $24 million term loan to fund the acquisition of the plastic shelving and cabinet business unit of Centrex Plastics.

Katy (OTC: KATY) is a manufacturer, importer and distributor of commercial cleaning and consumer storage products. Katy markets its products under the Continental, Contico, Wilen and Fort Wayne Plastics brands.  The company is headquartered outside of St. Louis in Bridgeton, MO (www.katyindustries.com).

As part of the transaction with Centrex Plastics, Katy will assume the lease at Centrex’s 100,000 sq. ft. manufacturing facility in Tiffin, OH and will collaborate with Centrex on manufacturing processes, resin procurement, product development, as well as various sales and marketing initiatives.  Centrex will continue to manufacture its remaining injection-molded plastic products for consumer and commercial applications out of its facility in Findlay, OH (www. centrexplastics.com).

“Katy has a strong platform that is well positioned to execute on numerous value creation initiatives. The Centrex acquisition provides an opportunity to rapidly expand its presence in the home storage market and to enhance its product offering with its existing customer base,” said Matthew Ray, senior partner at VPC. “We are pleased to have provided the acquisition financing and are excited to partner with management as the company enters this transformational period.”

 “We are excited about the growth opportunity with Centrex and could not have closed the acquisition without the new credit facility and the speed by which VPC was able to provide us with the necessary capital,” said David Feldman, president and CEO of Katy. “The acquisition brings Katy a state-of-the-art manufacturing operation, a growing line of home storage products, and a mutually beneficial partnership with an innovative and technically proficient company. I look forward to working closely with the Centrex team and growing our businesses together.”

Victory Park Capital invests from $10 million to $50 million per transaction in small cap public companies and middle market private companies that typically generate less than $150 million in revenue and less than $30 million of EBITDA. The firm focuses on complex situations and seeks to build long term sustainable value in its companies. Victory Park was founded in 2007 and is based in Chicago with additional offices in Boston, Los Angeles, New York and San Francisco (www.victoryparkcapital.com).

© 2015 PEPD • Private Equity’s Leading News Magazine • 4-13-15

Argosy Closes Fund V at Hard Cap

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Argosy Private Equity has held a final closing for Argosy Investment Partners V, LP (AIP V).  The new fund closed at the hard cap of $300 million and fundraising was completed in only six months.

Capital commitments for AIP V are from new and existing financial institutions, insurance companies, foundations and high net worth individuals, as well as a leverage commitment from the SBA.  The final close took place on January 30, 2015.

So far AIP V has invested approximately $40 million of capital in four platform companies: Flow Dry Technology –  a provider of moisture control products and gaskets (www.flowdry.com); LSSI – a provider of outsourced library management services (www.lssi.com); Panhandle Oilfield Service Companies – an oil and gas services company providing roustabout services, maintenance, equipment sales, and trucking (www.posci.net); and Ranger Aerospace – a provider of aero components overhaul and retrofit services to the commercial airlines (www.rangeraerospace.com).

Argosy invests from $5 million to $15 million in lower middle market companies that have revenues of $10 million to $100 million and EBITDA margins of 10% or greater.  Sectors of interest include manufacturing, business services, and value-added distribution.  The firm is headquartered in the Philadelphia suburb of Wayne, PA (www.argosycapital.com).

© 2015 PEPD • Private Equity’s Leading News Magazine • 4-13-15

Abacus Backs Riverside’s Buy of R&D Altanova

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Abacus Finance was the Administrative Agent and Joint Lead Arranger for a group of senior secured credit facilities used to support the recent investment in R&D Altanova by Riverside Partners.  Abacus also made an equity co-investment in R&D Altanova.

Abacus team members that worked on this transaction with Riverside included Sean McKeever, Eric Petersen, and Joe Lee.  Abacus targets debt financing opportunities of up to $50 million with a typical hold size ranging from $10 million to $30 million. The companies that Abacus finances generally have EBITDAs between $3 million and $15 million.

“This is a new relationship for us, and there has been a lot of enthusiasm here at Riverside to do a transaction with Abacus. Hopefully, this will lead to a lot more collaboration across our firms in the future,” said Riverside General Partner David Belluck. “Given the quality of work the Abacus team did on R&D Altanova, their speed and smoothness of execution, and just the general sense of good partnership we felt during the negotiations, I know I will highly recommend them.”

R&D Altanova is a designer and manufacturer of advanced printed circuit boards used to test integrated circuits used in computers, servers, mobile devices and other applications. Major industries served include the semiconductor, telecom, aerospace, defense, medical and radio device markets. R&D Circuits acquired Altanova in the fall of 2013 and changed its name to R&D Altanova.  The company has four locations, with its headquarters and interface board manufacturing located near New York in South Plainfield, NJ; assembly and elastomer operations in Allentown, PA; signal integrity, design engineering , and sales services in San Jose, CA; and a regional repair and sales office in Hsinchu, Taiwan (www.rdaltanova.com).

Riverside Partners invests in middle market healthcare and technology-oriented companies that have revenues from $20 million to $200 million and EBITDA’s from $5 million to $25 million. Riverside Partners is currently investing its fifth fund, Riverside Partners Fund V, LP, with $561 million of capital commitments. The firm was founded in 1989 and is based in Boston (www.riversidepartners.com).

“In any new relationship, you hope to establish a good working rapport, and we were able to do that quickly with David, his colleagues and the R&D Altanova management team,” said Tim Clifford, President and CEO of Abacus Finance. “Our knowledge and experience in the technology sector, the assurance of a quick close and our flexibility were all important factors for Riverside – each a critical ingredient in what we call our Total Partnership Approach.”

Abacus was joined in the financing by MidCap Financial (www.midcapfinancial.com) and legal counsel was provided to Abacus by Goulston & Storrs (www.goulstonstorrs.com).

Abacus was formed in June 2011 and is an affiliate of New York Private Bank & Trust, the holding company for Emigrant Bank, founded in 1850, the largest privately held bank in America with approximately $10 billion in assets. Abacus is based in New York (www.abacusfinance.com).

© 2015 PEPD • Private Equity’s Leading News Magazine • 4-13-15

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