Archives for September 16, 2016

MidOcean and Wasserstein Sell Penton

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MidOcean Partners and Wasserstein & Co. have entered into an agreement to sell Penton, a professional information services company, to Informa for $1.56 billion. The consideration will consist of $1.46 billion in cash and $100 million of Informa stock. The transaction is expected to close in the fourth quarter of 2016. Penton has an annual run rate EBITDA of $140 million which equates to an 11x purchase price multiple.

In October 2005, Wasserstein & Co. acquired the Business Information segment of PRIMEDIA for $385 million in cash and renamed the company Prism Business Media. In February 2007, Prism acquired business-to-business trade magazine publisher Penton Media for $530 million. At this time, MidOcean acquired a 50% interest in the combined Prism/Penton which was renamed Penton Media. Later, the Media portion of the name was dropped and the company became known as just Penton.

Under MidOcean and Wasserstein ownership, Penton was transformed from predominantly a print business into a professional information services company. Penton completed 13 acquisitions, creating scaled positions in growth-oriented sectors—including agriculture, transportation, natural products/food, infrastructure, and industrial design/manufacturing sectors. Today, Penton has seven of the top 250 largest trade shows in the US, which have helped drive an event revenue CAGR of over 20% over the last four years. Additional investments have been made to create an industry leading team that has built a state of the art digital platform, launched numerous SaaS products and built a scaled and fast-growing digital content marketing services business. Penton is headquartered in New York (www.penton.com).

“We are incredibly proud of our partnership with Penton and the company’s success under CEO David Kieselstein,” said Barrett Gilmer, Managing Director of MidOcean and Co-Chairman of Penton. “This investment exemplifies the value we bring to our portfolio companies by working closely with management teams to identify attractive areas for expansion, enhance operations and drive growth. In this case, under David’s leadership, and in particular over the last four years, Penton achieved a dramatic shift in its business mix, completed a number of highly strategic acquisitions and nearly doubled EBITDA from $77 million to $140 million.”

MidOcean invests in middle market companies active in the business and media services, consumer, and industrial services sectors.  Through MidOcean Credit Partners, which launched in 2009, the firm manages approximately $4 billion across a series of alternative credit strategies, collateralized loan obligations, and separately managed accounts. The firm was founded in 2003 and has offices in New York and London (www.midoceanpartners.com).

Wasserstein & Co. is focused primarily on leveraged buyout investments and related investment activities in the media, consumer products and water equipment and services industries.  The firm has offices in New York and Los Angeles (www.wasserco.com).

“MidOcean and Wasserstein are seasoned, hands-on investors and have been invaluable partners in supporting Penton and allowing us to execute on our strategy,” said David Kieselstein, CEO of Penton. “Their strategic insight, resources, flexibility and experience in the media services sector have been essential to our transformation by enabling our organic growth through new investment initiatives and sourcing and coordinating multiple accretive acquisitions.”

© 2016 Private Equity Professional • 9-16-16

TPG and CPPIB Invest in Viking Cruises

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TPG Capital and Canada Pension Plan Investment Board (CPPIB) have made a minority investment of $500 million – $250 million each – for a combined stake of 17% in MISA Investments, the parent company of Viking Cruises. The transaction is expected to close by the end of the fourth quarter.

Viking Cruises has two operating units: Viking River Cruises, a European-based river cruise line, and Viking Ocean Cruises, an ocean cruise line launched in 2015.

Viking River Cruises operates a fleet of 59 vessels, all of which have been custom built or fully renovated since 1999, and 100% of the cabins are “outside” staterooms with windows or balconies. The ships also have onboard restaurants, bars, lounges, libraries and sun decks. The company christened 16 ships in a single day in 2014, breaking its own record that it held the previous year and earning it a place in the Guinness Book of World Records.

Viking Ocean Cruises operates two 930 passenger vessels – the Viking Star and Viking Sea – that currently sail the coasts of Scandinavia and the British Isles, and the waters of the Baltic Sea and the Mediterranean Sea. Viking will soon be adding four additional ships to its current ocean fleet – Viking Sky and Viking Sun are scheduled to launch in 2017 and two more ships are scheduled to launch by 2020.

Viking Cruises has a primary sales office in the United States, secondary sales offices in the United Kingdom and Australia, and operational offices in Switzerland. The company was founded in 1997 by CEO Torstein Hagen (www.vikingcruises.com).

“I am delighted that such prestigious institutions as TPG and CPPIB have become investors in Viking. This partnership and infusion of long-term growth equity capital will give us great opportunities to grow further, particularly in destination-focused ocean cruising as well as cruising in Europe for Chinese consumers,” said Mr. Hagen.

The Canada Pension Plan Investment Board (CPPIB) invests in public equities, private equities, real estate, inflation-linked bonds, infrastructure and fixed income instruments. CPPIB is headquartered in Toronto, with offices in London and Hong Kong (www.cppib.ca).

“Our investment in Viking is an attractive opportunity to invest in a market-leading business with an impressive track record, and substantial room for expansion,” said Pierre Lavallée, Senior Managing Director & Global Head of Investment Partnerships, CPPIB. “Viking’s business is exposed to a number of long-term growth drivers that our thematic investing group looks for, and believes will deliver strong risk-adjusted returns.” CPPIB’s thematic investing group researches and invests in securities that are exposed to long-horizon structural changes. Typically, theme-based investment portfolios span geographies and sectors.

TPG has been an investor in the cruise industry since January 2008 when it acquired a minority equity interest in Norwegian Cruise Lines. “Having been a long-time investor in the cruise industry, we see Viking as a market innovator that has re-imagined how people explore the world, with an iconic brand and strong product offering that has significant growth potential,” said Paul Hackwell, Principal at TPG. “Together with CPPIB, as the company’s first institutional equity investors, we look forward to partnering with Tor and the Viking management team to expand the business, both in products offered and regions served.”

TPG was founded in 1992 and makes investments throughout North America, Europe, Asia and Australia.  Sectors of interest include industrials, retail, consumer, financial services, travel and entertainment, technology, media and communications, and healthcare.  In May 2016, TPG held a final close of its latest fund, TPG Partners VII, LP, with $10.5 billion in commitments. The firm has offices in San Francisco, Fort Worth, Austin, Dallas, Houston, New York, Beijing, Hong Kong, Istanbul, London, Luxembourg, Melbourne, Moscow, Mumbai, São Paulo, Singapore, and Tokyo (www.tpg.com).

Credit Suisse (www.credit-suisse.com) was the exclusive placement agent to MISA Investments in connection with the transaction.

© 2016 Private Equity Professional • 9-16-16

KODA Sells KLW Plastics

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KLW Plastics, a portfolio company of KODA Enterprises Group, has been acquired by BWAY Corporation, a portfolio company of Stone Canyon Industries.

KLW Plastics, a portfolio company of KODA since 2005, is a manufacturer of one to seven gallon rigid and semi-rigid tight-head plastic containers that are used in the food, chemical and agricultural end-markets. The company has a 40,000 sq. ft. manufacturing and headquarters facility located northeast of Cincinnati in Monroe, OH, with additional manufacturing facilities in Houston and Atlanta (www.klwplastics.com).

BWAY is a manufacturer of rigid metal and plastic containers that are used primarily for packaging of industrial, bulk food and retail goods. Products include aerosol cans, ammunition boxes, cone and pour top cans, metal paint cans, oil cans, and plastic drums. The company is led by CEO Ken Roessler. BWAY operates 25 plants throughout the United States and Canada and is based in Atlanta (www.bwaycorp.com).

Stone Canyon Industries acquired BWAY from Platinum Equity in August 2016 for $2.4 billion. Platinum acquired BWAY in December 2012 from Madison Dearborn Partners for $1.2 billion.

Stone Canyon invests in companies valued between $50 million and $1 billion. Sectors of interest include consumer and retail; food and ingredients; industrial; technology and business services; and transportation. The firm was founded in 2014 and is led by Co-CEOs James Fordyce and Adam Cohn and is headquartered in Santa Monica (www.stonecanyonllc.com).

KODA Enterprises Group invests in manufacturing, distribution and consumer products companies that have from $20 million to $100 million in revenues and $2 million to $10 million in EBITDA. Sectors of specific interest include building products and services; chemicals; industrial distribution and services; metals; paper and packaging; and rubber and plastics. KODA was founded in 1989 and is headquartered in Waltham, MA (www.koda.com).

New York-based investment bank Sperry, Mitchell & Company (www.sperrymitchell.com) was the exclusive financial advisor to KLW Plastics.

© 2016 Private Equity Professional • 9-16-16

Atlantic Street Expands

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Atlantic Street Capital has hired three new investment professionals with the hirings of George Parry and M. Kurt Lentz as Principals of the firm, and Sarah Robson as Vice President of Business Development.

“We are proud of the remarkable long term stability of our organization, yet as we continue our growth path we recognize the need for additional experienced and talented partners who fit our culture and principles,” said Peter Shabecoff, Atlantic Street Capital founder and Partner. “George and Kurt both have extensive industry experience executing transactions and working directly with portfolio company management teams to build successful businesses in industries related to our areas of focus.”

Prior to joining Atlantic Street, Mr. Parry was a vice president at Corinthian Capital Group since 2010. Before his time at Corinthian, he was a Vice President at Amalgamated Capital, and an Associate at Churchill Financial and ViaFinance Group.  He is a graduate of Harvard University and received his MBA from Cornell University.

Mr. Lentz’s earlier experience includes private equity, principal lending, and investment banking. He joins Atlantic Street from Sun Capital Partners where he was a Principal active in making control equity investment and divestitures. Prior to Sun Capital he was with American Capital Strategies and began his career in the corporate and leveraged finance group at CIBC World Markets. He has a BA in Economics from Claremont McKenna College.

Prior to joining Atlantic Street, Ms. Robson was a Director at New York-based Axial, where she managed a team of consultants who partnered with boutique investment banks and private equity firms to create business development strategies. She received a BBA from the University of Georgia.

“We are very pleased to have Sarah join our team as we continue to grow and build our firm,” said Grant Marcks, Vice President, Head of Business Development for Atlantic Street Capital.  “Sarah’s knowledge is a great complement to our team and she will provide us with a strong competitive advantage as we source and evaluate transactions and seek to broaden our network in the lower middle market.”

Atlantic Street Capital invests from $5 million to $20 million in middle market companies with revenues from $25 million to $150 million. Sectors of interest include consumer products and services, transportation and logistics, business services, and basic manufacturing. The firm was founded in September 2006 and is based in Stamford, CT (www.atlanticstreetcapital.com).

© 2016 Private Equity Professional • 9-16-16

Platte River Builds Team

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Platte River Equity has added three new investment professionals to its team with the hirings of James “J.B.” Moore as a vice president, and Tarun Kanthety and Brian Hopkin as new associates.

Before joining Platte River, Mr. Moore was an associate at private equity firm Aurora Capital Group and an investment banking analyst in the Global Industrials & Services Group at Credit Suisse.  He received his MBA from Wharton and he has a BBA in Finance from the University of Wisconsin.

Mr. Kanthety comes to Platte River from Simmons & Company International where he was an analyst active in M&A advisory and capital market financings in the energy service and equipment sector.  He has a BBA from The University of Texas.

Mr. Hopkin was an analyst in the Industrials Group at Barclays Capital prior to joining Platte River.  While at Barclays, he worked on M&A transactions and financings in the industrials, metals and transportation sectors. Mr. Hopkin holds a BS in accounting from Brigham Young.

Platte River makes equity investments of $20 million to $80 million in lower middle-market companies with enterprise values between $40 million and $250 million. The firm focuses on investing in the aerospace and transportation; energy and industrial products and services; and chemicals, metals, minerals and agriculture sectors. Platte River is based in Denver (www.platteriverequity.com).

© 2016 Private Equity Professional • 9-16-16