Audax Private Equity has combined two of its specialty chemical portfolio companies, California Products Corporation and Nicoat, to form Innovative Chemical Products Group.
The combination of these two companies was inevitable once Audax acquired California Products, a maker of interior and exterior paints and stains based in Andover, MA, from Delos Capital in October 2015 (www.calprocorp.com). Audax was already the owner of Nicoat, a manufacturer of water-based and UV-curable coatings used in graphic art, packaging, and specialty coating applications, which it acquired in March 2015 from Caltius Equity Partners. Nicoat is based just outside Chicago in Itasca, IL (www.nicoat.com).
As one company, ICP Group (ICP) is now active in the formulation, manufacturing, and marketing of coatings and adhesives. The company serves the architectural, specialty construction, packaging, printing and sport surfaces end markets. Brand names include California Paints, Fiberlock, Storm System, Nicoat, Decoturf, Plexipave, and Rebound Ace Z. ICP has warehousing and manufacturing capabilities near Chicago in Itasca, IL and is headquartered near Boston in Andover, MA (www.icpgroup.com).
ICP is led by Doug Mattscheck, its President and Chief Executive Officer. Mr. Mattscheck is the former Chief Executive Officer of Quest Specialty Chemicals, a former Audax portfolio company which was sold in August 2015. Prior to Quest, Mr. Mattscheck was President and Chief Executive Officer of AGY, a manufacturer of specialty glass fibers and yarns.
“Doug’s experience and successful track record working with private equity-backed companies make him an excellent leader for ICP. We are thrilled that he has joined us as we continue to execute our growth strategy,” said Don Bramley, Managing Director of Audax Group. ICP will grow its business by leveraging its brands and scalable operations through both organic growth and add-on acquisitions in the coatings, adhesives, sealants, and elastomer market verticals.
ICP’s growth strategy was in evidence this morning as the company signed an agreement to acquire the assets of 3M’s pressurized polyurethane foam adhesives business (PPFA). This business, with annual revenues of approximately $20 million, is a provider of products that are used in the residential roofing, commercial roofing and insulation, and industrial foam segments.
According to Mr. Mattscheck, ICP plans to maintain PPFA’s existing operations in Tomball, TX (near Houston) and Coral Springs, FL (near Boca Raton), as a stand-alone business unit within ICP. Approximately twenty 3M employees are expected to join ICP as part of the sale. “This acquisition extends the market, technology, and customer base of our business and gives us a foothold into polyurethane technologies. We will accelerate growth of this business through investments in products, sales and marketing, and acquisitions.”
Audax is no stranger to the specialty coatings and adhesives markets having previously invested in ColorMatrix, KODA Distribution Group, Gabriel Performance Products, and the earlier mentioned investment in Quest Specialty Chemicals.
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. The firm was founded in 1999 and has offices in Boston, New York and Menlo Park (www.audaxgroup.com).
© 2016 PEPD • Private Equity’s Leading News Magazine • 1-20-16
