Archives for April 15, 2015

Windjammer Exits Protective Industries

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Windjammer Capital Investors has sold its portfolio company Protective Industries to Berwind Consolidated Holdings, a family-owned investment management company.  Windjammer acquired Protective Industries through its third fund in May 2011.

Protective Industries (DBA Caplugs) is a manufacturer of plastic protection products. The company’s products include molded and extruded caps, plugs, masking, and other products that are used in a range of industries to keep items protected during shipment and storage.  Caplug’s products are also used to keep open ports free of contaminants, protect machined threading from damage, and to provide a covering for rough edges, exposed bolts, and exposed pipe ends. The company specializes in injection molding, vinyl-dip molding and plastic extrusion, producing approximately 2 billion pieces per year.  Caplugs was founded in 1948 and is headquartered in Buffalo with an additional facility in China (www.caplugs.com).

In May of 2011, Windjammer partnered with management and other investors to acquire Caplugs.  During the firm’s ownership period, revenues and EBITDA more than doubled. The company achieved these financial results through both organic growth and add-on acquisitions.

“From the beginning of our investment in Caplugs we knew there were a number of acquisition targets to pursue. Through our disciplined M&A approach we were able to augment the platform’s business through four acquisitions which increased the company’s product breadth, geographic reach and positioned the company to take share in high growth markets,” said Greg Bondick, Managing Director of Windjammer.  “This M&A plan was complemented by a series of organic market initiatives that added significant earnings momentum as well, such as the implementation of a new product development program, a reorganization of the sales and marketing functions, and the construction of a purpose built Chinese manufacturing facility.”

Windjammer makes control investments in middle market businesses with EBITDAs from $10 million to $40 million. Sectors of interest include advanced manufacturing, specialty distribution and business services.  The firm is currently investing out of Windjammer Senior Equity Fund IV with capital commitments of $725 million. Windjammer was founded in 1990 and is based in Newport Beach, CA and Waltham, MA (www.windjammercapital.com).

The buyer of Caplugs, Berwind Consolidated Holdings, is part of Berwind Corporation, a fifth-generation, family-owned investment management company.  Berwind targets middle market companies with transaction values of $75 million to $700 million, and focuses on manufacturing businesses in a range of industries including pharmaceutical, specialty chemical, office and craft, automotive, consumer and natural resources. .  The firm has roots that date back to 1886 and is based in Philadelphia, PA (www.berwind.com).

Houlihan Lokey acted as Caplugs’ financial advisor and Choate Hall & Stewart provided legal counsel.

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

Levine Leichtman Acquires Hand and Stone

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Levine Leichtman Capital Partners (LLCP) has acquired Hand and Stone Franchise Corp., a franchisor of massage and facial spas.  Hand and Stone is the fifth investment made by Levine Leichtman’s fifth fund.

Founded in 2004, Hand and Stone has over 200 locations across the US and Canada.  The company’s franchisees offer massage, facial and hair removal services along with other services such as aroma therapy and hot towel exfoliation.  Hand and Stone is headquartered near Trenton in Hamilton, NJ (www.handandstone.com).

Todd Leff, Hand and Stone’s Chief Executive Officer, and his management team will retain an equity interest in the company and will continue to lead Hand and Stone.

“We are excited to partner with Todd Leff and the rest of the management team who have led the tremendous growth of Hand and Stone, and solidified the company’s position as a market leader in the industry,” said Lauren Leichtman, Co-Founder and CEO of LLCP.  “With its nationwide network of franchisees and strong brand recognition, the company is uniquely positioned to benefit from the continued growth in the massage and facial spa industry.”

Levine Leichtman 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, London and The Hague (www.llcp.com).

“Having a partner with a long history of successfully investing in franchise businesses was attractive to us in selecting our new financial partner,” said Mr. Leff.  “LLCP’s franchise expertise and resources will be critical in helping us move into our next phase of growth and in supporting our franchisees. I expect this partnership will contribute meaningfully to the continued development of Hand and Stone.”

Hand and Stone was advised by Lazard Middle Market (www.lazardmm.com) and Blank Rome (www.blankrome.com) provided legal counsel.  LLCP was advised by Kirkland & Ellis (www.kirkland.com).

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

Riverside Acquires Message On Hold Plus

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Riverside is continuing the build of its Spectrio on-hold marketing messaging platform with the buy of Message On Hold Plus (MOHPlus).

MOHPlus provides on-hold messaging at approximately 1,500 locations and it provides additional services including business music, auto attendant prompts and greetings.  The company sells primarily to healthcare customers such as hospitals and physicians, but also has building supply, insurance, financial, and hospitality clients.  MOHPlus is based in Greensboro, NC (www.mohplus.com).

“MOHPlus boasts a solid customer base in North Carolina with outstanding industry expertise,” said Riverside Principal Peter Tsang. “MOHPlus customers can look forward to continued excellent service in addition to new capabilities from Spectrio.”

This is the second add-on completed by Riverside since acquiring Spectrio in October 2014 from SJ Partners. Last month, Spectrio completed the acquisition of Sound Marketing Concepts, also a provider of on-hold marketing messaging.  Sound Marketing Concepts is based north of Boston in Rowley, MA (www.soundmarketingconcepts.com).

Spectrio is a national provider of on-hold messaging and digital signage managed services.  Services include content creation, professional production of audio or visual content, installation, and network management. The company is based near Tampa in Oldsmar, FL (www.spectrio.com).

Working with Mr. Tsang on the transactions for Riverside were Partner Chris Jones, Senior Associate Max Moehlmann, Associate Linda Xu and Operating Partner George Benson.

The Riverside Company is a global private equity firm focused on investing in and acquiring growing businesses valued at up to $250 million (€200 million in Europe). Since its founding in 1988, Riverside has invested in more than 380 transactions. The firm’s international portfolio includes more than 75 companies. Riverside is headquartered in New York with additional offices in Atlanta, Chicago, Cleveland, Dallas, Los Angeles, San Francisco, and London (www.riversidecompany.com).

Riverside’s strategy with Spectrio is to continue expansion of the company through organic growth and additional add-ons.

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

NXT Backs Gridiron Buy of Dent Wizard

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NXT Capital has provided a senior secured credit facility to support Gridiron Capital’s recent acquisition of Dent Wizard from H.I.G. Capital.  NXT was the Joint Lead Arranger, Administrative Agent and Sole Bookrunner for the transaction.

Dent Wizard offers a range of reconditioning services for vehicles, such as removing dents, dings, creases and hail damage from vehicles without affecting the original factory finish. Other services include bumper, scratch, wheel, leather and vinyl, and carpet and fabric repair services.  Dent Wizard provides its services to car dealerships, automobile manufacturers, auto auctions, body shops and collision centers, rental car agencies, insurance companies, fleet owners and operators and individual vehicle owners. Dent Wizard was founded in 1983 and is headquartered in the St. Louis suburb of Bridgeton (www.dentwizard.com). H.I.G. Capital acquired Dent Wizard in November 2010 through a carve-out from Manheim Auctions, a wholly owned subsidiary of Cox Enterprises.

Gridiron Capital invests in manufacturing, service and specialty consumer companies that have EBITDAs from $5 million to $30 million and that are located in the United States and Canada. The firm is based in New Canaan, CT (www.gridironcapital.com).

NXT Capital provides structured financing of up to $150 million with a hold size up to $50 million to middle-market companies through its Corporate Finance, Equipment Finance, and Real Estate Finance groups.  NXT Capital also provides investment advisory services through its wholly-owned subsidiary NXT Capital Investment Advisers.  The firm is based in Chicago with offices in Atlanta, Charlotte, Dallas, Los Angeles, Nashville, New York, Phoenix, San Francisco and Stamford (www.nxtcapital.com).

In January 2015, NXT Capital closed NXT Capital Senior Loan Fund III, LP, an $800 million leveraged loan fund that will invest in first and second lien loan transactions originated and underwritten by NXT Capital’s Corporate Finance Group.  Transactions made by the fund include term, delayed draw term, revolving credit, stretch senior, unitranche, first lien term behind revolver, split lien and last-out term loans made primarily to private equity-sponsored middle market companies across a range of industries.  Fund III follows NXT Capital Senior Loan Fund II, LP, a similar $783 million fund that closed in July 2013.

© 2015 PEPD • Private Equity’s Leading News Magazine • 4-14-15