Archives for August 4, 2016

Watermill Group Acquires Experi-Metal

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The Watermill Group has acquired Experi-Metal, a provider of prototyping and metalformed parts and assemblies used in the automotive and aerospace industries.

Experi-Metal (EMI) makes engineered, metal-formed prototypes, sub-assemblies, body-in-white (BIW) assemblies, and provides bridge production services to companies in the automotive, aerospace, defense and alternative energy industries [Note: body in white or BIW refers to the stage in automotive design or automobile manufacturing in which a car body’s sheet metal components have been welded together]. Experi-Metal was founded in 1959 and is headquartered in the Detroit suburb of Sterling Heights (www.experi-metal.com).

The buy of EMI is Watermill’s second transaction in the automotive industry in the past 13 months. In June 2015, Watermill acquired Quality Metalcraft (QMC), a producer of metal components and assemblies, providing prototyping and low-to-medium volume production to companies in the automotive and specialty vehicle industries. Quality Metalcraft was founded in 1964 and is headquartered in the Detroit suburb of Livonia, MI (www.qualitymetalcraft.com).

QMC is led by its CEO Kurt Saldana who will now serve as the chief executive at EMI. EMI is led by its president, Gerry King, who will now take on the role of head of prototype sales for both EMI and QMC.

Together, ENI and QMC can provide prototyping and niche production services to OEMs, automakers and start-ups in the automotive and other industries. “The automotive industry is in the midst of a monumental shift. Technology-driven trends are transforming consumer appetite and disrupting an industry that has remained mostly unchanged for decades,” said Steven Karol, Managing Partner and Founder, the Watermill Group. “By operating collaboratively, EMI and QMC will offer unparalleled benefits to traditional OEMs, tier-one suppliers and new entrants to the market, all of whom seek the creativity, speed and quality that drives success today and will continue to drive market transformation.”

The Watermill Group invests in manufacturing, value-added distribution, and business services companies that have $50 million to $500 million of revenue and up to $30 million in EBITDA. Sectors of interest include aerospace; automotive and heavy truck; building products and services; chemicals; energy and energy services; food products and services; industrial distribution and services; metals; paper and packaging; and rubber and plastics. The firm is based in Lexington, MA (www.watermill.com).

Cerberus Business Finance (www.cerberuscapital.com) and the Business Credit Division of PNC Bank provided financing to support the acquisition of EMI. Cowen & Company (www.cowen.com) was the placement agent for the debt. Goodwin Procter (www.goodwinlaw.com) provided legal counsel to Watermill.

© 2016 Private Equity Professional • 8-4-16

Dubin Clark Buys Celebration Event Rental

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M&M Event Rentals, a portfolio company of Dubin Clark, has acquired Celebration Event Rental. This is the sixth company the firm has acquired in the event rental equipment sector and continues a consolidation effort which began in December 2014.

Celebration Event Rental provides event rental equipment including tables, chairs, tents, linens, and place settings to commercially-oriented customers such as catering and food services companies, educational institutions, event venues, corporate accounts, event planners, and not-for-profit organizations. The company was founded in 2008 and is headquartered just west of Dallas in Grand Prairie, TX (www.celebrationeventrental.com).

“Due to the quality of its product and customer service, this merger made complete sense,” said Scott Berk, President of M&M’s Texas Operations. “Celebration has made a name for itself in the special events market in the Dallas and Fort Worth metroplex and we can’t wait to bring our inventories together to offer even more to our clients’ event needs.”

In December 2014, Dubin Clark acquired Peterson Party Center (later renamed PPC Event Services), a renter of party and event equipment including table linens, tents, and chairs. PPC is based near Boston in Woburn, MA (www.petersonpartycenter.com). In April 2016, PPC acquired Chicago-based Rentals Unlimited, a renter of party and event equipment. Earlier in 2016, PPC also acquired Canton, MA-based Reserve Modern, a renter of tables and chairs.

In March 2016, Dubin Clark acquired M&M Event Rentals, an event service company that provides tables, chairs, linens, tents, lighting, and other equipment for weddings, social parties, and corporate events in the Chicago metropolitan and Dallas Ft. Worth metro areas. M&M is headquartered in the Chicago suburb of Carol Stream (www.mmspecialevents.com). In July 2016, Dubin Clark acquired BBJ Rentals, a provider of special event linen rental products and services to weddings, social and corporate events. BBJ Rentals was founded in 1983 and is headquartered in the Chicago suburb of Niles (www.bbjlinen.com). M&M and BBJ Rentals have not been consolidated with PPC and stand as a separate portfolio investments in Dubin Clark’s portfolio.

Dubin Clark invests in companies that have from $10 million to $100 million in sales and at least $2 million of EBITDA. Sectors of interest include manufacturing, value-added distribution, and services. The firm was founded in 1984 and has two offices, one in Boston and the other near Jacksonville in Ponte Vedra Beach, FL (www.dubinclark.com).

San Antonio-based The Stansberry Firm (www.thestansberryfirm.com) represented Celebration Event Rental on this transaction.

© 2016 Private Equity Professional • 8-4-16

Falfurrias Acquires Green Distribution

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Falfurrias Capital Partners has acquired Green Distribution, a maker and distributor of heat transfers and screen printed custom apparel.

Green Distribution provides printing, distribution, and art content management services for heat transfers and screen printing in the custom apparel sector. The company has a front-end web platform that allows its customers – currently totaling more than 4,000 – to customize their orders and allows Green Distribution to rapidly fulfill orders of heat transfers and screen printed apparel. Green Distribution was founded in 2009 and has facilities in Secaucus, NJ and Gordonsville, VA (www.greendistro.com) (www.fmexpressions.com).

Green Distribution has over 500 employees and is led by its CEO Robert Butters. Mr. Butters will continue in his role as CEO of the company and is an equity holder in the company in partnership with Falfurrias.

“Green Distribution has flourished in today’s apparel market, which values customization and quick turnaround times,” said Falfurrias Managing Partner Marc Oken. “We are pleased to partner with its creative management team to capitalize on the many growth opportunities that lay ahead.”

Falfurrias makes equity investments of at least $3 million in companies with revenues in excess of $10 million and EBITDAs in excess of $2 million. Industries of interest include financial services; consumer products; health care; building products; diversified manufacturing; business services; education, training, and information services; and infrastructure services.  Falfurrias was founded in 2006 by Hugh McColl Jr., former chairman and CEO of Bank of America, and Marc Oken, former CFO of Bank of America. The firm is based in Charlotte, NC (www.falfurriascapital.com).

“The landscape of the apparel industry has shifted toward customized solutions for personalized apparel and promotional items, and Green Distribution has responded by investing heavily in technology and developing a unique solution for customers requiring fast turn manufacturing. With the Falfurrias partnership, our company has the opportunity to become a leader in the industry,” said Mr. Butters.

© 2016 Private Equity Professional • 8-4-16

CenterOak Closes Debut Fund at Hard Cap

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CenterOak Partners has held a final close of CenterOak Equity Fund I, LP with total commitments at the hard cap of $420 million. The significantly oversubscribed fund had an initial target of $350 million.

CenterOak was launched in September 2014 by Randall Fojtasek, former co-founder and co-chief executive officer of Brazos Private Equity Partners. He leads the firm alongside former Brazos senior executives Michael Salim, Lucas Cutler, Jason Sutherland and William Henry. These five executives have worked together for nearly 15 years.

“We are very pleased to complete this fundraise,” said Mr. Fojtasek. “We credit our fundraising success to our track record, focused investment strategy, and experienced and stable team.”

CenterOak makes equity investments of $20 million to $90 million in companies with enterprise values of $50 million to $250 million. Sectors of interest include manufacturing, consumer and business services. The firm is headquartered in Dallas (www.centeroakpartners.com).

“We will continue our proven approach of finding companies with attractive characteristics, building strong relationships with management teams and operating executives to create value. We thank our limited partners for their support and commitment to our firm,” added Mr. Fojtasek.

In February 2016, CenterOak completed the acquisition of Cascade Windows, a manufacturer of vinyl windows and doors serving the Western US.  Other portfolio investments include BlackHawk Industrial; Cheddar’s Casual Café; Eberle Design; Ennis Paint; Flint Trading; Lone Star Overnight; ORS Nasco; Rennhack Marketing Services; Southern Tide; Strategic Equipment and Supply; and Tri-Northern Security Distribution.

Credit Suisse Private Fund Group, which assists in raising funds with targets of $300 million to $2 billion, was CenterOak’s placement agent for this fundraise.

© 2016 Private Equity Professional • 8-4-16

Arlington Closes Latest Fund at Hardcap

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Arlington Capital Partners has held a final close of Arlington Capital Partners IV, LP with total capital commitments of $700 million, the fund’s hard cap, and in excess of its target of $575 million. The fundraise was oversubscribed and reached its final close just three months from launch.

Limited partners in Fund IV include public pension funds, corporate pension funds, insurance companies, fund of funds, and foundations. Fund IV will continue Arlington’s strategy of investing in high-growth government-related sectors including aerospace and defense, government services and technology, healthcare, and business services and software.

Arlington is one of the most active private equity firms in the government sector, having completed more than twenty transactions over the past five years. Arlington’s current portfolio includes EOIR Technologies – a provider of information technology services to the US department of defense and government intelligence agencies; Endeavor Robotics – a provider of ground-based robots for use in dangerous and hostile environments; MicroPact – a provider of case management and business process management software; and Quantum Spatial, a geospatial analytics firm.

EOIR Technologies was acquired by Arlington in June 2016 and is a great example of a company that the firm likes to acquire. EOIR’s services include cloud computing; big data analytics; data visualization; C4ISR (Command, Control, Communications, Computers, Intelligence, Surveillance and Reconnaissance); smart sensing, training and simulation; and vehicle-based target acquisition systems. EOIR has approximately 400 employees in 11 US offices and is headquartered in Fredericksburg, VA (www.eoir.com).

With the close of Fund IV, Arlington Capital Partners now has $2.2 billion of committed capital. The firm invests in buyouts and recapitalizations of companies valued from $50 million to $500 million. Sectors of interest include government services and technology; aerospace and defense; healthcare; and business services and software.  Arlington Capital Partners is based in Chevy Chase, MD (www.arlingtoncap.com).

Evercore Private Funds Group was the placement agent for this fundraise and Kirkland & Ellis served as legal counsel.

© 2016 Private Equity Professional • 8-4-16