Archives for January 19, 2016

Marlin Buys Cobham’s Surveillance Business

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Marlin Equity Partners has acquired the video, audio and surveillance products business of Cobham for $10 million. The acquired business now operates under the name The Surveillance Business.

The Surveillance Business (TSB) designs, manufactures and sells video, audio and other surveillance products for use by intelligence agencies, national law enforcement organizations, military special forces, and commercial operations. The company’s products are used for video surveillance, audio surveillance, tagging, tracking and locating products, cellular monitoring and intercept technologies, and surveillance operation command and control. TSB was founded in 2001 and maintains two headquarters, one in Tampa, FL and the other in Whiteley, UK.

Marlin Equity Partners considers TSB to be one of the top providers of surveillance equipment. “We are excited to partner with the leading global provider of high-end surveillance equipment and are passionate to deepen TSB’s long-standing relationships with its global, blue-chip customer base,” said Ryan Wald, a partner at Marlin. “As an independent company, TSB is now well-positioned to execute on its growth plan and continue to provide the most advanced, mission-critical surveillance solutions in the market.”

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).

“With Marlin, we have gained a strategic partner with deep corporate divestiture experience and a strong track record of growing global companies,” said Dan Gelston, who will continue to lead TSB under Marlin ownership. “TSB’s market leading position in technologically innovative surveillance equipment combined with Marlin’s operational expertise will provide TSB’s customers with unmatched products and service.”

Cobham (LON: COB), the seller of TSB, is a defense products manufacturing company based in Wimborne Minster, UK. The company is considered to be one of the top 50 defense companies in the world (www.cobham.com).

© 2016 PEPD • Private Equity’s Leading News Magazine • 1-19-16

Arsenal Acquires BioreclamationIVT

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Arsenal Capital Partners has acquired a majority equity position in BioreclamationIVT from Thompson Street Capital Partners (TSCP).

BioreclamationIVT (BIVT) provides biological products to the early stage drug discovery and development industry. The company’s products include plasma, serum, tissue and cellular material products which are used by biological researchers in new drug discovery and development and to validate the safety and efficacy of new compounds during pre-clinical research and in clinical diagnostics. The company is based on Long Island in Westbury, NY (www.bioreclamationivt.com).

TSCP acquired BIVT in April 2013 and will retain a minority equity ownership interest in the company. Other investors in BIVT include Baltimore-based In Vitro Technologies; UK-based SeraLabs; and Chestertown, MD-based ILSbio.

“This recapitalization allowed us to generate a strong return for our investors while simultaneously providing additional resources to fuel the company’s continued growth,” said Bob Dunn, Managing Director of TSCP. “Together with the management team at BIVT, we were able to establish a leading position in the specialty biological products space. We are excited to work with our new partners at Arsenal to facilitate the next stage of growth at BIVT.”

Arsenal Capital Partners invests in middle-market specialty industrial and healthcare companies that have $50 million to $250 million in enterprise value.  Industries of specific interest include specialty & fine chemicals; segments of healthcare; transportation and logistics; power generation; aerospace & defense; and process industry components and services.  Arsenal has $1.7 billion of committed capital under management. The firm was founded in 2000 and has offices in New York and Shanghai (www.arsenalcapital.com).

Thompson Street Capital Partners makes investments in companies with annual revenues between $20 million and $200 million and EBITDA between $4 million and $15 million. Since its founding in 2000, Thompson Street has acquired more than 100 companies in the business services, healthcare services and engineered products sectors. In December 2015, TSCP held a final close of TSCP IV with $640 million in commitments. Fundraising for the new fund began in September 2015 and closed in December 2015. The total commitments of $640 million exceeded the fund’s target of $500 million and the original hard cap of $600 million. TSCP is based in St. Louis (www.tscp.com).

Perella Weinberg Partners (www.pwpartners.com) and Sidley Austin (www.sidley.com) advised BIVT on this transaction. Golub Capital (www.golubcapital.com) – the company’s existing lender – provided debt financing for the transaction.

© 2016 PEPD • Private Equity’s Leading News Magazine • 1-19-16

Brentwood Acquires Boston Proper

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Brentwood Associates has acquired the Boston Proper, a direct-to-consumer business from Chico’s FAS.

Boston Proper is a multi-channel specialty retailer of women’s high-end apparel and accessories that is available nationwide by direct mail catalog and online. The company was founded in 1992 and is headquartered in Boca Raton (www.bostonproper.com).

Brentwood’s strategy is to build a direct-to-consumer lifestyle brand through Boston Proper’s print, digital and social channels. “Brentwood has been a loyal and longstanding fan of Boston Proper and its management team, having tracked the business for over a decade,” said Eric Reiter, a partner at Brentwood. “They occupy a unique and compelling niche within the women’s apparel and accessory market, and we believe we can be a valuable partner in their next stage of growth.”

The acquisition was made in partnership with existing Boston Proper management, including Boston Proper President and Chief Merchandising Officer Sheryl Clark. “Brentwood brings an extraordinary level of relevant experience and strategic insight to our company,” said Ms. Clark. “They not only have a proven track record of success with our business model, but they also have a strong understanding of who we are and a like-minded vision of where we want to go.”

Brentwood Associates is a consumer-focused private equity investment firm with over $1.4 billion of capital under management. Sectors of interest include branded consumer products; consumer and business services; direct marketing, including direct mail and e-commerce; education; health and wellness; restaurants; and specialty retail. The firm was founded in 1972 and is based in Los Angeles (www.brentwood.com).

“We see tremendous opportunity in Boston Proper’s direct-to-consumer channels, as the focus shifts back towards the brand’s unique customer value proposition,” said Roger Goddu, partner with Brentwood Associates.

The seller of Boston Proper, Chico’s FAS, is an omni-channel specialty retailer of women’s clothing, intimates, accessories, and other non-clothing items. The company is headquartered in Fort Myers, FL (www.chicosfas.com).

Chico’s FAS was advised by Peter J. Solomon Company (www.pjsolomon.com) as financial advisor and by Greenberg Traurig (www.gtlaw.com) as legal counsel. Brentwood was represented KPMG Corporate Finance (www.kpmgcorporatefinance.com) and Burr & Forman (www.burr.com).

© 2016 PEPD • Private Equity’s Leading News Magazine • 1-19-16

Here Comes Wynnchurch Industries

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Wynnchurch Capital has formed Wynnchurch Industries, a new platform company that will invest in and acquire industrial materials companies.

Wynnchurch Industries will use a “buy, grow, and hold” strategy and target companies with $5 million to $15 million in EBITDA. The new platform – based in the Detroit suburb of Bloomfield – will be led by Grant Beard as Chairman and CEO.

Beginning in 2011, Mr. Beard served as Chairman and then later took on the CEO position of Wolverine Advanced Materials, a subsidiary of Wolverine Automotive Holdings, which is a former Wynnchurch portfolio company. Mr. Beard led the sale of the company in October 2015 to ITT Corporation for $300 million.

Mr. Beard has broad operations and acquisition experience including time as President and CEO of Constar International – a supplier of rigid plastic packaging products used in the food and beverage industries – which he joined in 2010. Mr. Beard led the take private of Constar through a bankruptcy proceeding in 2011 which resulted in its acquisition by Black Diamond Capital Management and Solus Asset Management.

Prior to Constar he led the successful buy-and-build strategy that created TriMas Corporation (NASDAQ:TRS), a $1 billion revenue diversified holding company. His past also includes time as a private equity investor with Blue Point Capital, The Anderson Group, and The Oxford Group. Mr. Beard has an MA in International Economics from the University of Detroit and a BS and MBA in Finance from Miami University.

“Grant has demonstrated his leadership skills and value creation abilities throughout his career. On behalf of the partners of Wynnchurch, it gives me great pleasure to announce his leadership of Wynnchurch Industries,” said John Hatherly, President and Managing Partner of Wynnchurch.

Wynnchurch Capital makes investments of $10 million to $90 million in middle-market companies that have revenues of $5 million to $500 million. Sectors of interest include niche manufacturing, business and industrial services, energy and power services, logistics, transportation and value-added distribution. The firm was founded in 1999 and is located in the Chicago suburb of Rosemont with additional offices in Detroit and Toronto (www.wynnchurch.com).

© 2016 PEPD • Private Equity’s Leading News Magazine • 1-19-16

Fulcrum Adds Operating Partner

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Erick Hamdan has joined Fulcrum Capital Partners as its newest Operating Partner.  Mr. Hamdan is based in Edmonton where Fulcrum has now opened an office to continue focusing on the Alberta market as well as other investment opportunities in Saskatchewan and Manitoba.

Mr. Hamdan will work with Fulcrum and its portfolio companies to improve EBITDA and free cash flow through revenue and margin growth, cost and productivity initiatives, and balance sheet management. In addition, he will work with Fulcrum’s investment teams to source, review, and acquire new investments for Fulcrum fifth fund which closed above target in July 2015 with C$344 million in commitments.

Mr. Hamdan has more than 20 years experience as a CFO with private companies in real estate, energy, and industrial services sectors. Over the last 10 years, he worked as CFO and an investor for two companies backed by SCF Partners, a Houston-based private equity firm. During this period, Mr. Hamdan was involved in the acquisition and management of over 35 companies that were integrated into two separate energy services platforms each with annual revenues of approximately $400 million and EBITDA margins over 20%.

Fulcrum Capital Partners manages over C$750 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. The firm 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.  Fulcrum has offices in Vancouver, Toronto and Edmonton (www.fulcrumcapital.ca).

© 2016 PEPD • Private Equity’s Leading News Magazine • 1-19-16

Lightyear Gets New Managing Director

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Lightyear Capital – a New York based private equity firm that specializes in middle-market financial services companies – has promoted Daniel Freyman to Managing Director. In addition to his promotion to Managing Director, Mr. Freyman will also become a member of Lightyear’s Investment Committee.

Mr. Freyman joined Lightyear in 2007 from Credit Suisse where he spent nine years advising financial institution clients on mergers and acquisitions and capital raises. Mr. Freyman holds a BS in Applied Economics and Business Management from Cornell University.

“We are delighted to promote Dan to Managing Director after working with him for almost ten years. His knowledge of the financial services space has contributed positively to the success of Lightyear in identifying opportunities and growing existing investments. We value his insights and look forward to his continued contributions,” said Mark Vassallo, Managing Partner of Lightyear.

“I’m excited to take on this new role,” said Mr. Freyman. “Lightyear has a long history of investing in financial services, and I look forward to continue leveraging our collective experience to strive to create value for our investors.”

Lightyear makes control investments in North America-based, middle-market financial services companies. Subsectors of specific interest include asset management, banking, brokerage, financial technology, insurance, and specialty finance.  The firm is headquartered in New York (www.lycap.com).

© 2016 PEPD • Private Equity’s Leading News Magazine • 1-19-16