April 17, 2015
Search

Private Equity Professional

Private Equity's News Leader

There is a right and a wrong in the universe, and that distinction is not hard to make.
Superman

You are here: Home / 2015 / April / Archives for 17th

Archives for April 17, 2015

Fulcrum Carves Out Innovative Steam Technologies

by

steam nf1Fulcrum Capital Partners has partnered with the management of Innovative Steam Technologies to complete a carve-out of the company from Aecon Group.

Innovative Steam Technologies (IST) designs, engineers, manufactures and installs heat recovery steam generators that are used in power generation and oil recovery applications.  IST’s customers include multi-nationals; power utilities; independent power producers; oil and gas producers; and engineering, procurement and construction (EPC) companies.  IST was founded in 1992 and has approximately 170 employees.  The company is headquartered in Cambridge, ON (www.otsg.com).

Fulcrum Capital Partners manages over C$675 million of capital and invests both equity and subordinated debt in companies with revenues of C$10 million to C$250 million. Sectors of interest include services, manufacturing, consumer products, distribution, food and retail. Fulcrum Capital Partners was formed in 2011 as the successor to HSBC Capital (Canada) Inc. when current management acquired the private equity and mezzanine business of HSBC Bank Canada.  The majority of Fulcrum’s eight partners have worked together for over a decade. During this period at Fulcrum and its predecessor firm, the partners have invested in 38 companies and realized 24 exits, generating a gross return on cash invested of 3.3x and a gross IRR of 28.7%.  Fulcrum has offices in Vancouver and Toronto (www.fulcrumcapital.ca).

Innovative Steam Technologies represents Fulcrum’s third platform company for its fifth’s fund, Fulcrum Capital Partners V LP, which had a first close in December 2014 at C$180 million.  Fulcrum expects to have a final close at or around the target of C$300 million in the first half of 2015.  The two other platform companies in Fund V include GI Group, a Montreal-based manufacturer and distributor of paintballs, markers and other paintball products acquired in January 2015; and JNM Group, a Windsor-based manufacturer of tooling and stamped metal components and assemblies used in the automotive industry acquired in February 2015.

Aecon Group (TSE: ARE), the seller of Innovative Steam Technologies, is Canada’s largest publicly traded construction company and serves the infrastructure, energy, and mining sectors. The company was founded in 1877 and is headquartered in Toronto (www.aecon.com).

© 2015 PEPD • Private Equity’s Leading News Magazine • 4-17-15

Tricor Pacific Acquires Certified Recycling

by

recycle nf2Tricor Pacific Capital has acquired Certified Recycling, a provider of recycling and waste services based in Southern California.  Tricor’s investment in Certified Recycling was made out of Tricor Pacific Capital Fund V, a C$345 million fund which closed in June 2014.

“The investment from Tricor presents our family’s business with extraordinary opportunities, including the capital and additional experience to accelerate growth and enhance the level of service and support to our suppliers and brokers,” said Matt Dalton, Co-Owner of Certified.

Certified Recycling purchases recyclable materials from over 1,000 suppliers, sorts and bales the purchased materials, and then sells the product to recycled materials brokers who then on-sell the product for use by overseas mills. The company was founded by John Dalton Sr. and Louise Dalton in 1977 and operates two recycling facilities in Southern California. The company is headquartered in Anaheim (www.usa-recycling.net).

Lincoln International (www.lincolninternational.com), which has completed over 15 transactions in the environmental services market since 2012, acted as the exclusive financial advisor to Certified.  Lincoln provided advisory expertise and managed the marketing, negotiation and due diligence phases of the transaction.  “We were impressed with the level of personal attention and guidance Lincoln provided to our family throughout the sale process.  Their expert advice and close collaboration enabled us to achieve a successful outcome,” said John Dalton, Co-Owner of Certified.

Tricor Pacific invests in middle-market companies with enterprise values from $25 million to $250 million in the manufacturing, service, distribution and consumer product sectors that are located in the west and mid-west regions of Canada and the United States. The firm currently manages approximately $1 billion of capital and is investing its fourth fund with $555 million in committed capital. Tricor Pacific was founded in 1996 and is headquartered in Vancouver with an additional office in Chicago (www.tricorpacific.com).

© 2015 PEPD • Private Equity’s Leading News Magazine • 4-17-15

Azalea and Argosy Add-on to Ranger Aerospace

by

intech aero nf1Azalea Capital and Argosy Private Equity and have added on to their Ranger AeroSystems platform with an investment in InTech Aerospace.

InTech services and refurbishes heavy wear aircraft interior components such as seating, floor panels, windows, wall panels, trays, galleys and lavatories.  Customers include regional airlines, mainline carriers, large OEM’s, aircraft leasing companies, and other MRO facilities. The company was founded in 1998, and has operations and employees in four locations in the US with a headquarters in Houston (www.intechaero.com).

Azalea and Argosy formed the Ranger AeroSystems platform late last year with a goal to acquire aerospace companies with at least $10 million in revenues or EBITDA above $2 million. Specific areas of interest include (a) precision manufacturing – sole source or limited source flight critical parts on long life airborne platforms, both fixed wing and rotary wing; (b) component overhaul – value-added services for components, rotables, and sub-assemblies on any airborne system; (c) specialty MRO – technical services companies supporting commercial or military aircraft; and (d) other aerospace segments where a consolidation strategy can be carried out.

Azalea Capital, the lead investment group in Ranger AeroSystems, invests in middle market companies that have minimum annual revenues of $10 million and EBITDAs of $2 million to $10 million.  Industries of interest include manufacturing, business services, and value-added distribution with a special interest in aerospace, consumer packaged goods, healthcare and energy and industrial services.  Azalea Capital was founded in 1996 and is headquartered in Greenville, SC (www.azaleacapital.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.  Earlier this month, Argosy held a final closing of Argosy Investment Partners V, LP at the fund’s hard cap of $300 million.  The firm is headquartered in the Philadelphia suburb of Wayne, PA (www.argosycapital.com).

Ranger Aerospace is a private equity consolidator specializing in aerospace operations and aviation services.  Previous successful investments include Aircraft Service International Group, Keystone Helicopter, and Ranger International. Ranger’s ventures have employed up to 4,250 employees, with operations at as many as 56 airfields and operating sites in North America, Latin America, Europe, Middle East, and Pacific.  The firm was founded in March 1997 and is based in Greenville, SC (www.rangeraerospace.com).

© 2015 PEPD • Private Equity’s Leading News Magazine • 4-17-15

Genstar Acquires Boyd from Snow-Phipps

by

boyd nf4Genstar Capital has acquired Boyd Corporation, a manufacturer of gaskets and seals and other specialty products that are used in energy management and environmental sealing applications, from Snow Phipps Group which acquired the company in July 2012 from Sentinel Capital Partners.

Boyd’s customers include multinational OEMs across various end markets, including the mobile computing, commercial vehicle, recreational vehicle, consumer electronics, agriculture and construction equipment, aerospace, and medical industries. The company is headquartered in Modesto, CA (www.boydcorp.com).

“Genstar has a proven record of supporting and growing companies in the industrial sector and they share our belief in the continued long-term success of our company.   Boyd has a strong position in a very large and highly fragmented market and we look forward to leveraging Genstar’s experience and additional capital to accelerate our plans for growth, both organically and through acquisitions,” said Mitch Aiello, President and Chief Executive Officer of Boyd.

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.  Genstar manages approximately $3 billion of committed capital and targets investments in the industrial technology, financial services, software, and healthcare industries.  The firm was founded in 1988 and is based in San Francisco (www.gencap.com).

During the course of Snow Phipps’ ownership the company completed several add-on acquisitions.  In August 2014, Boyd acquired the Asian and European die-cut businesses of Brady Corporation increasing its presence in the mobile computing and electronics markets while expanding the company’s footprint in Asia and establishing a presence in Europe.  In September 2014, Boyd acquired the SOLIMIDE foam business of Evonik AG, to grow the company’s aerospace presence.  Snow Phipps worked with Boyd to integrate these acquisitions and also made operating improvements at the company in the areas of customer relationship management, engineering, and manufacturing.

ian snow nf1“This transaction validates our investment process.” said Ian Snow, CEO and Partner of Snow Phipps.  “Acquiring high quality businesses like Boyd and building partnerships between management, our investment team and operating partners create significant opportunities for our portfolio companies during and after our ownership.”

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 from $40 million to $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).

UBS Investment Bank served as financial advisor to Genstar and Weil, Gotshal & Manges provided legal counsel. Snow Phipps’ financial advisor was Robert W. Baird & Co. and legal counsel was Simpson Thacher & Bartlett.

© 2015 PEPD • Private Equity’s Leading News Magazine • 4-17-15

Thoma Bravo Closes Special Ops Fund at Cap

by

thoma bravo nf1Thoma Bravo has completed fundraising for Thoma Bravo Special Opportunities Fund II at $1.06 billion. The fund closed at it hard cap and was oversubscribed.  The new fund will invest side-by-side with Thoma Bravo Fund XI, a $3.7 billion fund that closed in May 2014.

orlando bravo nf1“We are very appreciative of the investor support for this supplemental ‘top off’ fund, which we see as an acknowledgment of our team’s strong track record in software investing and the good start we believe we’ve gotten with our Fund XI,” said Orlando Bravo, a managing partner at Thoma Bravo. “We expect the Special Opportunities Fund to give us added flexibility in competing for investments at the larger end of the software market – where we think some of the best opportunities will be found.”

Thoma Bravo provides equity and strategic support to management teams building growing companies. The firm originated the concept of industry consolidation investing, which seeks to create value through the strategic use of acquisitions to accelerate business growth.  Thoma Bravo currently manages approximately $8.5 billion of equity capital. The firm was founded in 1981 and has offices in Chicago and San Francisco (www.thomabravo.com).

Thoma Bravo is led by managing partners Orlando Bravo, Seth Boro, Scott Crabill, Lee Mitchell, Holden Spaht and Carl Thoma; and partner Robert Sayle.

© 2015 PEPD • Private Equity’s Leading News Magazine • 4-17-15

KKR Closes $1.3 Billion Direct Lending Fund

by

KKR nf2KKR Credit has held a final close of KKR Lending Partners II LP (Fund II), a $1.3 billion fund focused primarily on privately-originated senior loans.  The new fund is the successor fund to KKR Lending Partners I LP which exited its investment period in December 2014.  Fund II, which KKR began fundraising in early 2014, held its first close in June 2014 and began investing its capital shortly thereafter.

Erik Falk nf1Fund II received backing from a group of new and existing investors, including public pensions, insurance companies, private banking platforms, family offices and individual investors.  “We are very pleased that we were able to attract a nice mix of new and existing KKR direct lending investors to the fund. We have a strong pipeline and are very optimistic about the opportunity set,” said Erik Falk, Co-Portfolio Manager of the Fund II.

KKR Credit was launched by KKR in 2004, to invest in bank loans, high yield securities, and alternative credit such as direct lending, mezzanine financing, and special situations.  KKR Credit had $26.9 billion in assets under management as of December 31, 2014.  KKR Credit has approximately 100 investment professionals and is based in New York (www.kkr.com/businesses/credit).

Chris Sheldon nf1According to Chris Sheldon, Co-Portfolio Manager for Fund II, “The lending landscape is being reshaped by a variety of factors, including geopolitical change, macroeconomic factors, and the regulatory environment – and we believe we are well positioned to drive high-quality, originated deal flow for our direct lending business.”

KKR makes private equity, fixed income and other investments in companies in North America, Europe, Asia and the Middle East. The firm has $90 billion in assets under management. KKR was founded in 1976 and in addition to its New York headquarters the firm has offices in Menlo Park, San Francisco, Houston, Washington DC, London, Paris, Hong Kong, Tokyo, Beijing, Mumbai, Dubai and Sydney (www.kkr.com).

© 2015 PEPD • Private Equity’s Leading News Magazine • 4-17-15

To search in site, type your keyword and hit enter