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Archives for June 2015

Silver Lake to Acquire Cast & Crew

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CAST AND CREW NF1Silver Lake has signed an agreement to acquire Cast & Crew Entertainment Services, a provider of payroll and production accounting services to the entertainment industry, from ZM Capital (ZMC) and other investors.  Cast & Crew’s senior management will remain in their current roles and continue as equity partners under the new ownership structure.

Cast & Crew Entertainment Services is a provider of payroll and other business process outsourcing services to the film, television, live entertainment and commercial production markets in North America.  Production companies use the company’s services to manage payroll processing and related regulatory filings; production accounting software; workers’ compensation insurance coverage and claims administration; residuals processing; procurement and purchasing services; labor relations; and production incentives guidance and reporting. Cast & Crew is headquartered in Burbank, CA and has field operations in New York, Albuquerque, Atlanta, Baton Rouge, New Orleans, Detroit, Philadelphia and Wilmington. Canadian offices are located in Toronto and Vancouver.  The company was founded in 1976 (www.castandcrew.com).

A ZMC-led consortium, including Veronis Suhler Stevenson, Emigrant Capital and other ZMC limited partners acquired the company in 2012. During the two-and-a-half year term of ownership, Cast & Crew achieved significant growth.  ZMC and management develop strategies to increase revenues with existing clients, develop new clients, expand into new geographies, and develop and launch new products (such as Cast & Crew Financial Services and Cast & Crew Open Health).  ZMC and management also began a set of initiatives to reduce costs and improve customer satisfaction metrics.  These initiatives were coupled with a large investment in Cast & Crew’s technology platform.

Jordan Turkewitz NF1“We take great satisfaction in Cast & Crew’s dynamic growth in recent years, driven by an outstanding management team and a talented group of employees.  We feel fortunate that we had the opportunity to work with the company during this phase of its growth and remain excited about Cast & Crew’s future prospects,” said ZMC Partner Jordan Turkewitz.

ZMC invests in media companies in which the partnership’s capital resources, industry relationships and operational experience can enhance growth and value. The firm is based in New York (www.zelnickmedia.com).

“Silver Lake’s technology expertise and entertainment industry understanding position them as the ideal strategic partner for our company,” said Eric Belcher, President and CEO of Cast & Crew. “We undoubtedly will benefit from Silver Lake’s involvement as we accelerate our investment in technology and as we bring new client-centric digital solutions to market.”

Silver Lake invests in technology and technology-enabled industries.  The firm has over 100 investment professionals located in New York, Menlo Park, San Francisco, London, Hong Kong, and Tokyo and has $26 billion in assets under management and committed capital (www.silverlake.com).

Joe Osnoss nf1“We admire what Cast & Crew’s excellent management team has achieved already with ZMC’s support,” said Silver Lake Managing Director Joe Osnoss.‎ “Technology’s impact on the global media and entertainment sectors will create many new opportunities for Cast & Crew and its clients in the years ahead, and we look forward to helping the company achieve its next phase of growth.”

RBC Capital Markets, Credit Suisse, Deutsche Bank Securities and Societe Generale are providing debt financing for the transaction.  Cast & Crew was advised in this transaction by Moelis & Company, Morgan Stanley & Co. and Sidley Austin. Silver Lake was advised by Kirkland & Ellis.

© 2015 PEPD • Private Equity’s Leading News Magazine • 6-30-15

Marlin Equity Partners Acquires IBS

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IBS nf1Marlin Equity Partners has acquired International Business Systems AB (IBS), a portfolio company of Symphony Technology Group since 2011 when Symphony took the company private.

IBS is a provider of distribution resource management software used in the wholesale, distribution and manufacturer/distributor markets. IBS’ products include an Enterprise Resource Planning and Supply Chain Management software suite, a warehouse management application, and a recently introduced sales and operations planning solution.  IBS was founded in 1978 by Staffan Ahlberg and Gunnar Rylander and is headquartered in Stockholm, Sweden (www.ibs.net/en).

Patrick Seely nf1Investment bank Mooreland Partners was the exclusive financial advisor to IBS. “The partnership with Marlin will allow IBS management to build on the company’s strong existing customer base worldwide, and drive growth from new product introductions,” said Patrick Seely, Managing Director at Mooreland Partners. Mooreland has offices in Silicon Valley, Greenwich, CT, and London  (www.moorelandpartners.com).

Symphony Technology Group invests in software and services companies. The firm was founded in 2002 and is based in Palo Alto, CA (www.symphonytg.com).

Marlin Equity Partners invests in businesses that have revenues of $20 million to $1 billion and that are in the process of undergoing varying degrees of operational, financial or market-driven change. Sectors of interest include technology, healthcare, consumer products and services, business services, manufacturing, aerospace & defense, distribution & logistics, and media. The firm has $3 billion of capital under management and is headquartered in Los Angeles with an additional office in London (www.marlinequity.com).

© 2015 PEPD • Private Equity’s Leading News Magazine • 6-30-15

Superior Adds-on to Rostra Precision Controls

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grote nf1Superior Capital Partners (SCP) has completed an add-on acquisition for its portfolio company Rostra Precision Controls.  Vehicle Safety Manufacturing (VSM), a division of Rostra, has acquired the turn signal switch product line of Grote Industries.

According to SCP, the buy of Grote’s turn signal switch operation positions VSM as the leader of domestically produced turn signal products for the North American heavy duty truck market.  The assets and manufacturing lines of Grote’s turn signal switch product line will be relocated from Madison, IN to VSM’s manufacturing facility in Newark, NJ.

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Turn Signal Switch With Flash-to-Pass And Marker Flash

Rostra Precision Controls is a manufacturer and distributor of electronic accessories including obstacle sensing systems, cruise controls and comfort systems to the light-vehicle aftermarket.  The VSM Division, which was acquired by Rostra in 2014, is a supplier of heavy duty turn signal switches, lighting products and safety components to both OEM and aftermarket customers in the heavy duty and slow moving vehicle marketplaces.  Rostra also manufactures electronic transmission components for the automotive aftermarket and for original equipment manufacturers. The company is headquartered in Laurinburg, NC (www.rostra.com).

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“The acquisition of the Grote product line represents exactly the type of operationally intensive, value-added bolt-on acquisition that we seek in order to create out-sized returns for our investors,” said Mark Carroll, Superior’s Managing Partner.  “We’ve been working with the Rostra management team and Grote’s customers for months in preparation for the move of the production line.  When it is successfully transitioned, VSM will have the number one market position and have the lowest cost operation.  The acquisition of the Grote product line also brings technology that we intend to commercialize in order to further strengthen the company’s position.”

Superior Capital Partners invests in niche manufacturers, value-added distributors and specialty service companies with annual revenues between $10 million and $150 million. Superior will invest up to $15 million of equity per transaction in management buyouts, corporate spin-offs, recapitalizations, family successions, acquisitions out of bankruptcy and debt purchases. The firm is based in Detroit (www.superiorfund.com).

The acquisition of Grote’s turn signal switch operation is the 20th acquisition completed by Superior’s 2008 inaugural fund.

© 2015 PEPD • Private Equity’s Leading News Magazine • 6-30-15

Blackstone to Sell AlliedBarton to Wendel

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allied barton nf1Blackstone has agreed to sell its portfolio company AlliedBarton to Wendel SE for approximately $1.7 billion.   The sale of AlliedBarton was initiated by Blackstone in March 2015 and according to reports at that time Blackstone was looking to receive $1.5 billion in enterprise value for the company. Blackstone acquired AlliedBarton in 2008.

AlliedBarton generated revenues of approximately $2.2 billion and recorded an adjusted EBITDA of $148 million for the twelve months ended March 31, 2015. This results in a purchase price multiple of 11.6x.  To fund the acquisition, Wendel will make an equity investment of approximately $670 million, for a 96% ownership interest in the company with AlliedBarton’s management team holding the remainder of the equity. The balance of the purchase price will be funded through debt.

AlliedBarton is a provider of security services to more than 3,300 customers, including 200 members of the Fortune 500 and is considered to be the largest provider of security services in the US.  Customers of the company are active in commercial real estate, higher education, healthcare, financial services, government services, aerospace and defense, petrochemicals and retail. AlliedBarton was founded in 1957 and has more than 60,000 employees and 120 regional offices.  The company is headquartered in the Philadelphia suburb of Conshohocken (www.alliedbarton.com).

Bill Whitmore nf1“Blackstone’s counsel and invaluable support have been instrumental to the development and growth of our business, which has resulted in a successful investment outcome for all equity holders,” said Bill Whitmore, President and CEO of AlliedBarton.  “Blackstone has been a tremendous partner over the last seven years and I appreciate the contributions made by Peter Wallace and the entire Blackstone team.”

Blackstone is one of the world’s largest investment and advisory firms. The firm’s alternative asset management businesses include the management of private equity funds, real estate funds, hedge fund solutions, credit-focused funds and closed-end funds. Blackstone also provides various financial advisory services, including financial and strategic advisory, restructuring and reorganization advisory and fund placement services. Blackstone is headquartered in New York (www.blackstone.com).

peter wallace nf1“It has been a privilege partnering with Bill Whitmore and the exceptional management team at AlliedBarton in supporting their efforts to build the preeminent security services firm in the US. We are very proud of the accomplishments and significant value that has been created under our ownership, during which the company substantially grew revenues, profitability and employment,” said Peter Wallace, Senior Managing Director at Blackstone.

Wendel SE, the buyer of AlliedBarton, is one of Europe’s oldest investment firms and has been supported for over three centuries by the Wendel family, its largest shareholder. The firm is headquartered in Paris (www.wendelgroup.com/en).

Credit Suisse acted as exclusive financial advisor and Simpson Thacher & Bartlett acted as legal advisor to Blackstone.

© 2015 PEPD • Private Equity’s Leading News Magazine • 6-30-15

Sumitomo Mitsui to Buy GE’s European Sponsor Finance Business

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ge cap nf1GE has agreed to sell its European Sponsor Finance business to Sumitomo Mitsui Banking Corporation Europe Limited (SMBCE), a wholly owned subsidiary of Sumitomo Mitsui Banking Corporation (SMBC) for approximately $2.2 billion.  GE’s European Sponsor Finance business is one of the leading providers of sponsor finance for European mid-market, private-equity backed transactions.

Earlier this month, GE reached an agreement to sell its US Sponsor Finance business and a $3 billion loan portfolio to Canada Pension Plan Investment Board in a transaction valued at approximately $12 billion.

Keith Sherin NF1“As GE Capital continues to execute on its strategy to sell most of the assets of GE Capital, this agreement with SMBCE shows our European businesses are of great interest to financial services firms around the world,” said Keith Sherin, GE Capital chairman and CEO. “We had many indications of interest in this business and are pleased to partner with SMBCE on the sale of this franchise,” he added.

SMBCE’s has been active in providing sponsor finance since 1997 when the group founded its Leveraged Finance group in London. Since launch, the group has completed over 158 transactions with commitments in excess of $5.2 billion. The group’s current leveraged portfolio totals $1.9 billion.

“We are excited to announce this agreement to sell the European Sponsor Finance Sponsor Finance to SMBCE,” said Mr. Sherin.  “This represents another important milestone as we continue to execute on our strategy to sell most of the assets of GE Capital.”

GE Capital will retain its $1 billion investment in the European Senior Secured Loan Program and European Loan Program; both are joint ventures between GE Capital and Ares Capital.

Bank of America Merrill Lynch and Citigroup Global Markets are providing financial advice to GE.

Sumitomo Mitsui Banking Corporation is a Japanese multinational banking and financial services company headquartered in Tokyo, Japan. It is a wholly owned subsidiary of Sumitomo Mitsui Financial Group and is the second largest bank in Japan.

The sale to SMBCE is expected to close in the third quarter of 2015.

© 2015 PEPD • Private Equity’s Leading News Magazine • 6-30-15

Keystone Capital Adds-On to Rocore

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CTI NF1Rocore, a portfolio company of Keystone Capital, has acquired CTI Industries.  CTI repairs and refurbishes heat exchangers and steam condensers. Keystone acquired Rocore in October 2008.

CTI’s repair services are used in the refinery, marine, power generation, and utility industries. The company’s customer base includes blue-chip customers in all of these industries.  In addition to its North American operations in Orange, CT, the company operates a division in Dubai, UAE (www.cti-ind.com).

CTI will operate as an independent division of Rocore and all managers and employees of CTI will remain with the CTI division and join Rocore. Perry Tallman, co-owner of CTI alongside his brother Peter prior to the acquisition, will join Rocore as President of the CTI division. “Our father was a co-founder of CTI in 1976, and CTI is a special part of our family,” said Perry Tallman. “We are confident that we’ve found a great partner in Rocore and Keystone, and we look forward to continuing CTI’s market leading position well into the future.”

Rocore is a designer and manufacturer of heat exchangers and other equipment used to cool air, water, or oil for a variety of applications.  Rocore’s products are manufactured out of five North American facilities and are sold to original equipment manufacturers and aftermarket users across a range of industries, including heavy duty truck, power generation, industrial, rail, military, bus and construction equipment.  The company is headquartered in Indianapolis (www.rocore.com).

Keystone Capital invests in middle market companies with EBITDAs of $3 million to $15 million that are market leaders in niche, mature industries. Sectors of interest include niche manufacturing, industrial technology, food products and packaging, healthcare products and services, business and professional services. Keystone Capital manages in excess of $200 million in investment capital and is based in Chicago (www.keystonecapital.com).

Senior debt financing was provided by The Private Bank (www.theprivatebank.com) and legal counsel was provided by Kirkland & Ellis (www.kirkland.com).

2015 PEPD • Private Equity’s Leading News Magazine • 6-29-15

Hellman & Friedman to Acquire Kadel’s Auto Body

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KADELS NF1ABRA Auto Body & Glass, a portfolio company of Hellman & Friedman, has signed an agreement to acquire Kadel’s Auto Body, a portfolio company of KCB Private Equity since August 2007.  Hellman & Friedman acquired ABRA Auto Body & Glass from Palladium Equity Partners in August 2014.

Kadel’s is an auto-body service provider serving the Pacific Northwest region.  The company has grown both organically and through acquisitions and currently operates 23 locations in Oregon, Washington and Idaho. The company was founded in 1954 and is headquartered south of Portland in Tigard, OR (www.kadels.com).

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ABRA is a national provider of vehicle damage repair services.  The company provides collision repair, paintless dent removal, and auto glass repair and replacement services through 286 company-owned and franchised vehicle damage repair centers in 22 states.  ABRA’s services enable its insurance company partners to improve customer satisfaction and drive policyholder retention, while reducing repair costs and driving efficiencies in the claims process. ABRA was founded in 1984 and is headquartered in Minneapolis (www.abraauto.com).

KCB Private Equity makes control investments in public or private companies that have $10 million to $60 million in recurring revenue and $1 million to $6 million of EBITDA with margins of greater than 10%. Industries of interest include retail; consumer products and services; business services and outsourcing (including technology and software tools); healthcare services (including skilled nursing facilities); education and training services and products; light manufacturing; and value-added distribution. KCB Private Equity was founded in 1986 and is based in Pasadena, CA (www.kcbpem.com).

Hellman & Friedman invests from $300 million to $1 billion in companies across a range of industries including energy & industrials; software; business and marketing services; internet and digital media; financial services and insurance; media; and healthcare. Founded in 1984, the firm has raised and managed over $25 billion of committed capital and invested in over 60 companies.  Since forming its first partnership in 1987, Hellman & Friedman has raised over $35 billion of committed capital. The firm is based in San Francisco with additional offices in London and New York (www.hf.com).

Harris Williams & Co. (www.harriswilliams.com) is the exclusive advisor to Kadel’s on its sale to ABRA Auto Body & Glass.  The transaction is being led by Joe Conner of Harris Williams & Co.’s Transportation & Logistics Group and Ryan Budlong, Matt Conaty and Zach England of the firm’s Consumer Group.

“We are thrilled to have represented Kadel’s shareholders in this transaction, which represents another marquee deal for Harris Williams & Co. in the automotive aftermarket services sector,” said Mr. Conner, a managing director at Harris Williams & Co. “Given our recent automotive aftermarket services sector success with Caliber Collision Centers, ABRA, Mister Car Wash, Dent Wizard, Driven Brands and Kadel’s, we believe that strong and broad-based interest from both strategic and financial buyers will continue in this vibrant portion of the aftermarket.”

2015 PEPD • Private Equity’s Leading News Magazine • 6-29-15

Paine & Partners Exits Icicle Seafoods

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icicle nf1Paine & Partners and Icicle Holdings have entered into an agreement to sell Icicle Seafoods to Convergence Holdings and Dominion Catchers.  Convergence will acquire Icicle’s land-based wild seafood processing and farmed salmon activities, and Dominion will acquire the company’s harvesting and processing vessels and associated fishing rights.  Paine & Partners acquired Icicle Seafoods in 2007.  The transaction is expected to close in August 2015.

Convergence is the latest company established by the Indonesia-based Soetantyo family, which has a long history in the food and canning industries in Asia and North America.  Dominion Catchers is a Soetantyo family influenced company with the family owning 25% of the equity.  The American Fisheries Act prohibits foreign companies from owning more than 25% of vessels 100 feet long or greater. Among Icicle’s assets are 11 ships that exceed this threshold.

Icicle Seafoods’ core business is the processing of seafood including wild salmon, pollock, halibut, cod, sablefish and herring in most major fisheries throughout Alaska, with both on-shore and floating processing facilities. Icicle also owns the largest United States owned and operated salmon farming company located in the Pacific Northwest.  Icicle’s products are sold throughout the world into a variety of customer channels including industrial, food service, wholesale and retail.  Icicle was founded as Petersburg Fisheries in 1965 and is headquartered in Seattle (www.icicleseafoods.com).

W. Dexter Paine III NF1“Today’s announcement represents the culmination of Paine & Partners’ stewardship of Icicle,” said W. Dexter Paine, III, Chairman and CEO and a founding Partner of Paine & Partners.  “We used our investments and expertise in the seafood industry to accelerate Icicle’s growth and help the company achieve its business goals.  In Convergence and Dominion, the company will continue to have owners that will work with its management and employees to build on its successes.”

Paine & Partners provides equity capital for management buyouts, going private transactions, and company expansion and growth programs, for companies operating in the food and agribusiness industries.  The firm currently makes investments through Paine & Partners Capital Fund IV, LP. The firm was founded in 2006 and has offices in New York, Chicago and San Mateo, CA (www.painepartners.com).

“On behalf of everyone at Icicle, I would also like to thank Paine & Partners, which has been a valued strategic partner over the last eight years,” said Chris Ruettgers, Chief Executive Officer of Icicle.  “With Paine & Partners’ support, we grew our business, enhanced our operations and improved our ability to serve our diverse customer mix.”

2015 PEPD • Private Equity’s Leading News Magazine • 6-29-15

Vista Acquires Mediaocean

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mediaocean nf1Vista Equity Partners has agreed to acquire a majority interest in Mediaocean, a provider of software used by the advertising industry.  Michael Donovan, the executive chairman of Mediaocean, will continue as a board member and will retain the remaining equity in Mediaocean.  The transaction is expected to close in Q3 2015.

Mediaocean software automates advertising workflow – from planning and buying, to analyzing and optimizing, to invoicing and payments. The software has cross-media capability and can be used for both traditional and digital media.  Mediaocean software serves more than 80,000 users across advertisers, agencies, broadcasters and publishers.  The company was formed in 2012 through the merger of Donovan Data Systems and MediaBank LLC, which were led by Michael Donovan and Bill Wise, respectively. The company is headquartered in New York with six additional offices worldwide (www.Mediaocean.com).

Robert Smith nf2“Michael and Bill’s combined vision and know-how have built a mission-critical and integrated platform that makes Mediaocean the best-in-industry partner for their customers to stay competitive,” said Robert Smith, Founder, Chairman & CEO of Vista Equity Partners. “Together we can strengthen and expand Mediaocean’s existing solutions while pursuing exciting new growth opportunities in a dynamic and ever-evolving industry.”

Vista intends to accelerate the growth of the company and increase product innovation.  “Four years ago we created Mediaocean with the goal of providing the industry with an open platform to easily integrate campaigns across all traditional and digital media. I am truly proud of our growth and progress to date and believe that working together with Vista will allow us to continue to build on this success,” said Mr. Donovan.  “When Vista approached us, we were impressed by its strategic vision. They operate more like an enterprise software holding company than a classic private equity firm with nearly 200 employees — most of whom are operators, not finance professionals.”

Vista Equity Partners has more than $14 billion in committed capital and makes equity investments in enterprise software businesses and technology-enabled services companies. The firm was founded in 2000 and has offices in San Francisco, Chicago and Austin (www.vistaequitypartners.com).

“Vista’s investment is the next great milestone for Mediaocean and presents a significant opportunity to continue to build on our success, and truly advance the marketplace forward,” said Bill Wise, CEO of Mediaocean. “Our vision has always been to provide advertisers, agencies, broadcasters and publishers with a top-tier, converged advertising ecosystem. Partnering with Vista will allow us to accelerate progress in achieving this goal, while solidifying our leadership in the industry.”

2015 PEPD • Private Equity’s Leading News Magazine • 6-29-15

Pharos Acquires Physical Therapy Platform

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star physical nf1 star physical nf2Pharos Capital Group has acquired a control equity interest in MOTION PT Holdings, a provider of physical therapy and occupational therapy services in New York.

MOTION was formed through the combination of Brooklyn-based MetroSportsMed with Manhattan-based STAR Physical Therapy.  MetroSportsMed was established in 1995 by David Menche, MD. The company combined with STAR Physical Therapy in 2015 to form MOTION PT Holdings.  The combined company has 165 employees and is headquartered in Brooklyn with 10 locations in Brooklyn, Manhattan and Long Island (www.metrosportsmed.com) (www.starphysicaltherapy.com).  The company will continue to use the MetroSportsMed and STAR brands.

Dr. Menche will become Chairman of MOTION and Edward Miersch of MetroSportsMed will become the company’s President and CEO.  Michael Fox of STAR Physical Therapy becomes MOTION’S Chief Clinical Director and Benjamin Gelfand will be the Chief of Clinical Services.

The day-to-day operations of the company will be led by Mr. Miersch, who has decades of experience as an operator in the physical therapy industry.   He will also be responsible for acquiring and consolidating other physical therapy businesses both within New York and in other geographies.

jim phillips nf1“Pharos has unique experience with underserved markets and mid-sized healthcare businesses, and we are delighted to be working with Dr. Menche, Ed Miersch, and the MOTION management team to find bolt-on acquisition opportunities that will help the platform build the premier physical therapy network,” said Jim Phillips, Partner at Pharos.

“As hospitals across the country look to defray costs, we believe MOTION can capitalize on the movement by healthcare systems to outsource physical therapy services to expert third party providers,” said Pharos Principal Joseph Acevedo.  “MOTION is well positioned to take advantage of this trend and expand its network.”

Pharos Capital Group invests $25 million to $50 million in companies seeking later stage funding for internal growth, acquisitions, management buyouts or recapitalizations. The firm invests across many sectors but has a particular interest in healthcare and business services. Pharos has offices in Dallas and Nashville (www.pharosfunds.com).

The investment in MOTION marks the third portfolio investment from Pharos Fund III and follows Pharos’ January 2014 acquisition of behavioral health services provider Seaside Healthcare and the May 2014 acquisition of Employee Benefit Solutions, a provider of healthcare cost containment and wellness programs.

Investment bank Livingstone Partners (www.livingstonepartners.com) was the financial advisor to MOTION.

2015 PEPD • Private Equity’s Leading News Magazine • 6-29-15

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