Archives for November 2016

Corridor Expands Operations Team

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Corridor Capital has hired Thomas Mokulehua as Director of Finance on the firm’s operations team.

Mr. Mokulehua will be active in providing finance and accounting support to Corridor’s portfolio companies and he will also be involved in financial underwriting related to new investment opportunities.

Corridor Capital makes control investments of $3 million to $12 million in mid-market companies with EBITDAs of $2 million to $5 million. Corridor focuses on complex situations, particularly those requiring growth support or operational or financial engagement. Sectors of interest include specialty manufacturing, business services, and environmental services.

Prior to joining Corridor, Mr. Mokulehua was a member of DaVita HealthCare Partners’ corporate development and mergers & acquisitions team. Before joining DaVita, he was a senior manager in Deloitte Advisory’s Mergers, Acquisitions & Divestitures group where he focused on buy-side and sell-side financial diligence. He also worked at KPMG as an auditor and consultant. Mr. Mokulehua is a Certified Public Accountant and has degrees in accounting and finance from Loyola Marymount.

Corridor’s investor base includes approximately 150 executives across an array of industries and disciplines that the firm uses as an active resource for its portfolio companies and their teams. The firm is based in Los Angeles (www.corridorcap.com).

© 2016 Private Equity Professional • 11-17-16

LNC Partners Buys OutSolve

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LNC Partners has acquired OutSolve, a provider of affirmative action planning and compliance services to federal contractors. Five Points Capital co-invested alongside LNC Partners.

OutSolve’s services are used by government contractors to meet the requirements of Executive Order 11246, the Vietnam Era Veteran Readjustment Assistance Act (VEVRAA), and Section 503 of the Rehabilitation Act of 1973, among other regulations. Services include developing Office of Federal Contract Compliance Programs (OFCCP) compliant affirmative action plans, offering OFCCP audit support, and creating EEO-1 reports that comply with the requirements of the US Equal Employment Opportunity Commission. OutSolve was founded in 1998 and is based near New Orleans in Metairie, LA (www.outsolve.com).

LNC Partners invests from $4 million to $20 million in companies that have at least $10 million of revenue and at least $2 million of cash flow. Sectors of interest include business and information services; financial and insurance services; healthcare services; and niche manufacturing. LNC is a licensed Small Business Investment Company and has over $235 million of capital under management. The firm is based in Reston, VA (www.lnc-partners.com).

Five Points Capital invests equity and subordinated debt in lower middle market buyout, acquisition, growth, and recapitalization transactions as a control investor on a standalone basis or as a co-investor with other financial sponsors.  Sectors of interest include business, healthcare and industrial services; niche manufacturing; value-added distribution; and education and training. The firm is headquartered in Winston-Salem, NC (www.fivepointscapital.com).

© 2016 Private Equity Professional • 11-17-16

Woodlawn Exits Dynamatic

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Woodlawn Partners has sold Dynamatic, a maker of variable speed drives used in industrial and environmental applications, to TGP Capital Partners.

Dynamatic, acquired by Woodlawn in July 2010, is a designer and manufacturer of eddy current variable speed drives, brakes, and controls. The company’s products are used in the water and wastewater industry, as well as in materials processing, chemicals processing, and a number of other industrial markets. Dynamatic was founded in 1931 and is headquartered south of Milwaukee in Sturtevant, WI (www.dynamatic.com).

Eddy current variable speed drives have three elements: a constant speed AC induction motor, an electromagnetic clutch, and a digital controller. These elements combine to create a magnetic flux field that can be used to vary the output torque and speed of an industrial device. The stronger the magnetic field, the more of the input torque from the induction motor is translated to the output torque which then varies the speed of the machinery. Many industrial processes – such as assembly lines – must operate at different speeds for different products. Where process conditions demand adjustment of flow from a pump or fan, varying the speed of the drive may save energy compared with other techniques for flow control. When the output speed can be changed without steps over a range, the drive is referred to as variable speed.

“We partnered with the management team of Dynamatic to build the business by expanding distribution and growing in key end markets,” said Greg Bregstone, a Partner at Woodlawn. “We feel that Dynamatic is well positioned to continue its success and growth with TGP.”

Woodlawn Partners invests in companies that have revenues of more than $5 million and EBITDA of $1 million to $6 million. Sectors of interest include manufacturing, property and facility services, information technology, niche financial services, distribution, and transportation and logistics. The firm was founded in 2010 by Partners Greg Bregstone and Evan Gobdel and is based in Chicago (www.woodlawnpartners.com).

TGP Capital Partners invests from $3 million to $10 million in companies with revenues between $15 million and $50 million and EBITDA in excess of $2 million. Sectors of interest include general manufacturing and business services companies. The firm, based in Kansas City, was founded in 2005 and today is led by Managing Directors Eric Graham and Shane Parr (www.tgpinvestments.com).

© 2016 Private Equity Professional • 11-17-16

Riverside Acquires Window Genie

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The Dwyer Group, a franchising platform company of The Riverside Company, has completed the add-on acquisition of Window Genie.

The buy of Window Genie adds more than 100 franchise units to the company and grows Dwyer Group to $1.4 billion in system-wide sales. This is the eighth acquisition for Dwyer Group in the last 27 months and Riverside continues to seek other franchising companies to join Dwyer’s portfolio of service brands.

Window Genie offers residential and light commercial window cleaning, window tinting, pressure washing and other services. The company was founded in 1994 by CEO Rik Nonelle and has more than 100 franchise units operating in 29 states. Mr. Nonelle will assume the role of brand president for Window Genie within the Dwyer Group organization. Window Genie is based in Cincinnati (www.windowgenie.com).

“Joining the Dwyer Group will allow our franchisees to take part in the organization’s collective buying power, provide us with deeper support resources and enable us to rapidly expand our footprint,” said Mr. Nonelle.

The Dwyer Group, acquired by Riverside in August 2014, is now the owner of 14 service-based franchise organizations: Aire Serv, Glass Doctor, The Ground Guys, Mr. Appliance, Mr. Electric, Mr. Rooter, Mr. Handyman, Portland Glass, Rainbow International, Five Star Painting, Molly Maid, ProTect Painters, Locatec, and Window Genie. These brands collectively have more than 2,600 franchises in ten countries.  The Dwyer Group was founded in 1981 and is headquartered in Waco, TX (www.dwyergroup.com).

“The buy of Window Genie delivers both a compelling business opportunity for future franchise prospects as well as a complementary trade that fits our overall portfolio of service brands,” said Mike Bidwell, President and CEO of Dwyer Group.

The Riverside Company is a global private equity firm focused on investing in and acquiring growing businesses valued at up to $400 million. Since its founding in 1988, Riverside has invested in more than 440 transactions. The firm’s international portfolio includes more than 80 companies. The firm is headquartered in New York with additional offices in Atlanta, Chicago, Cleveland, Dallas, Los Angeles, San Francisco, and London (www.riversidecompany.com).

© 2016 Private Equity Professional • 11-17-16

Debut Fund Closed by ParkerGale

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ParkerGale Capital has closed its debut fund at $240 million. The new fund had a balanced mix of limited partners that included family offices, pensions, managed accounts, endowments and funds of funds. The original target was $200 million.

The fund’s first close was held in September 2015 with $47 million in total commitments: $20 million from a family office, $10 million from a fund-of-funds, $5 million from a small managed account, and the balance from a number of individual investors.

ParkerGale makes control investments in founder-owned, profitable technology companies with subscription or transaction-based revenue models. The firm was founded in 2014 by five former members of Chicago Growth Partners – Devin Mathews, Dave Chandler, Jim Milbery, Kristina Heinze and Ryan Milligan. “We are excited to be in business and humbled by the support of our limited partners,” said Mr. Mathews. “Now back to our day jobs – finding more management teams to support and great companies to buy.”

ParkerGale has completed two acquisitions so far for the new fund. In November 2015 the fund acquired Aircraft Technical Publishers (ATP) from founding family member and CEO Caroline Daniels. Upon closing of the acquisition, ParkerGale named Charles Picasso, a co-investor on this transaction, as ATP’s new CEO. ATP sells parts and maintenance data as well as workflow management software to companies that repair and maintain small airplanes. This is the general aviation market, which includes tens of thousands of maintenance, repair and overhaul (MRO) and fixed based operator (FBO) service providers. ATP customers buy products on an annual subscription basis and the company currently has about 17,000 subscribers. According to ParkerGale, ATP is the only organization that integrates information directly from more than 54 of the world’s leading manufacturers to create the industry’s most comprehensive repository of technical, operating, and regulatory data. ATP was founded in 1973 and is headquartered in San Francisco (www.atp.com).

The second acquisition was the buy of OnePlus Systems in October 2015. OnePlus is a provider of systems that monitor large trash compactor activity and provides access control and usage reporting, as well as data analytics. The company’s products and cloud-based software platform are used by retailers, manufacturers, property managers, hospitals and hospitality operators to reduce costs and increase operating efficiencies. OnePlus has an installed base of several thousand sensor units with over 200 customers across all 50 states. OnePlus serves small and medium-sized businesses as well as Fortune 500 companies including Republic Services, General Electric, Lowe’s, American Airlines, Home Depot and Kroger. The company is led by CEO Klaus Voss and is headquartered in the Chicago suburb of Northbrook (www.oneplussystems.com).

“We believe we are building something unique here at ParkerGale, and we are grateful to our investors for helping us achieve that goal,” said Mr. Milbery.

Other members of the ParkerGale team include Chief Financial Officer Corey Dossett, Senior Advisor Tim Murray, Principals Alan Williamson and Kevin Fitzgerald, Associate Cass Gunderson and Office Manager Sharon Janowski. ParkerGale is headquartered in Chicago (www.parkergale.com).

BearTooth Advisors (www.beartoothadvisors.com) was the placement agent for ParkerGale and Kirkland & Ellis (www.kirkland.com) provided legal services.

© 2016 Private Equity Professional • 11-15-16

Marlin Expands in Software Testing

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QualiTest Group, a portfolio company of Marlin Equity Partners, has acquired Test Direct Limited, a provider of software testing and quality assurance services. Marlin acquired QualiTest Group in September 2016.

Software testing is a planned process that is used to identify the correctness, completeness, security and quality of software. Testing is generally done to demonstrate that the software is doing what it is supposed to do and that the software is not doing what it is not supposed to do. The goal of a quality assurance is to provide assurance that a product is meeting customer’s quality expectations. Test Direct provides its services to customers in a range of industries with particular specialization in the financial services sector. The company was founded in 2002 and is headquartered north of Liverpool in Preston, UK (www.test-direct.com).

QualiTest Group is a provider of outsourced software testing and business assurance services with offices in the US, UK, Israel and India. The company focuses on large global enterprises in the technology, telecom, healthcare, finance, defense, media, utilities and retail industries. QualiTest is headquartered in Fairfield, CT (www.qualitestgroup.com).

“Test Direct is a highly synergistic acquisition that brings a complementary service offering, strong customer base and talented management team to QualiTest’s existing UK business,” said Jan-Olivier Fillols, a Vice President at Marlin. “The addition of Test Direct validates our commitment and shared vision of diversifying QualiTest’s geographic footprint and accelerating growth through acquisitions.”

Marlin invests in businesses that have revenues of $20 million to $1 billion and are in the process of undergoing varying degrees of operational, financial or market-driven change. The firm is headquartered in Los Angeles with an additional office in London (www.marlinequity.com).

“The acquisition of Test Direct secures our position as one of the largest independent software testing and quality assurance companies in the UK,” said Ayal Zylberman, co-founder and CEO of QualiTest.  “We look forward to working with the Test Direct team to deliver a wider range of capabilities to our customers, career advancement opportunities for our employees and thought leadership to the testing and quality assurance market.”

© 2016 Private Equity Professional • 11-15-16