Archives for December 2016

Simplify Compliance Starts Info Roll-up

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Leeds Equity Partners has formed and invested in Simplify Compliance Holdings, a buy-and-build platform with an exclusive focus on the governance, risk and compliance market. Simplify Compliance represents the first investment for Leeds Equity Partners VI.

Simultaneous with formation of Simplify Compliance, the company has the following four companies: (1) Fortis Business Media – a provider of services to assist companies in complying with state and federal legal requirements across a variety of areas such as human resources, occupational health and safety, and environmental. Fortis was formed through the February 2011 merger of Business & Legal Resources (BLR) and M. Lee Smith Publishers (www.blr.com) (www.hcpro.com); (2) DecisionHealth, a provider of information and services to healthcare businesses. DecisionHealth publishes Part B News, Home Health Line and numerous specialty coding newsletters, known throughout the industry as “Pink Sheets” (www.decisionhealth.com); (3) Argosy Group, a provider of specialized financial and business information services (Argosy Group web page); and  (4) Center for Communications Management Information (CCMI), a provider of data and information to the telecom industry (www.ccmi.com). DecisionHealth, Argosy Group, and CCMI were acquired from UCG, a business-to-business publishing company headquartered in Gaithersburg, MD (www.ucg.com):

Simplify Compliance is led by Dan Oswald, the current CEO of BLR, and is headquartered in the Nashville suburb of Brentwood, TN. “Leeds Equity’s track record of providing support to leading businesses in the knowledge industries is unmatched, and we view our partnership with Leeds as a strategic asset of the company,” said Mr. Oswald. “We chose to work with Leeds because of the depth of their experience and expertise, and we are confident that their resources will enable Simplify Compliance to continue its successful expansion through new growth initiatives.”

Leeds Equity Partners is focused exclusively on investing in the education, training and information services industries.  The firm was founded by Jeffrey Leeds and Robert Bernstein in 1993 and has raised and managed more than $1.5 billion of capital across six funds.  The firm is located in New York (www.leedsequity.com).

“Dan and his team, through this combination, have created a special business,” said Scott VanHoy, Managing Director of Leeds Equity Partners. “The company operates a differentiated, scalable platform that enables its customers and clients to operate effectively in the complex and fast-changing environments in which they participate.   We are excited to help the company continue to grow organically and through acquisitions.”

BLR and UCG were advised by New York-based media investment bank JEGI (www.jegi.com).

© 2016 Private Equity Professional | December 21, 2016

Kinderhook Acquires NitroFill

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Kinderhook Industries has acquired NitroFill, a provider of nitrogen gas tire inflation services, in partnership with the company’s Chief Executive Officer, Jay Lighter.

NitroFill’s flagship product offering is the Tire Protection Plan program which is sold to and through new car dealerships. Filling and maintaining a tire with nitrogen gas instead of compressed air (air is about 78% nitrogen, 21% oxygen, and 1% other gases) protects the tire from the destructive effects, mainly elasticity and strength, that oxygen gas has on rubber and other tire materials. NitroFill’s Tire Protection Plan includes inflation services, tire repair and replacement coverage, roadside assistance and other benefits, as well as customer relationship management services used by dealers to increase customer traffic and tire and service sales. Dealers participating in NitroFill’s programs check and correct customer tire pressures with NitroFill for free during the customer’s membership period. NitroFill is headquartered in Pompano Beach, FL (www.nitrofill.com).

“We are thrilled to have the opportunity to partner with Kinderhook,” said Mr. Lighter. “When we set out to find the right partner to help fulfill our vision for NitroFill, we were focused on identifying a firm that could provide us with the financial and strategic resources we needed to rapidly grow our business. Kinderhook’s extensive experience in the automotive aftermarket coupled with their deep network of operating partners made them the clear choice for NitroFill. We are eager to embark on the next phase of our growth with the Kinderhook team.”

The buy of NitroFill is Kinderhook’s 38th automotive-related transaction and was completed using capital from the firm’s fourth fund, Kinderhook Capital Fund IV, which closed in 2014 with $500 million of committed capital.

“NitroFill has carved out an attractive niche in the tire care industry yet they have only scratched the surface from a market penetration perspective,” said Paul Cifelli, Managing Director at Kinderhook. “The opportunity to invest in expanding the company’s service offerings as well as geographic reach is highly attractive. There were more than 17 million cars sold this year in the United States and every one of them is a candidate for NitroFill’s suite of product offerings and tire care programs.”

Kinderhook Industries makes control investments in companies with transaction values of $25 million to $150 million in which the firm can achieve financial, operational and growth improvements. The firm makes investments in non-core divisions of public companies, management buyouts of entrepreneurial-owned businesses, troubled situations, and existing small capitalization companies lacking institutional support. Kinderhook was founded in 2003 and is based in New York (www.kinderhook.com).

Financing for the transaction was provided by TCF Capital Funding. Western Reserve Partners advised NitroFill on the transaction.

© 2016 Private Equity Professional | December 21, 2016

Platte River Buys Tiger-Sul Products

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Platte River Equity has acquired Tiger-Sul Products, provider of sulphur fertilizers and crop performance products, from H.J. Baker which has owned the company since 2005 and will retain a minority equity position.

Tiger-Sul is a manufacturer, importer and exporter of sulphur bentonite, sulphur bentonite micronutrients technology, and other crop performance products.  Sulphur Bentonite is a 90% pure elemental form of sulphur. It provides degradable sulphur to plants and is a key nutrient that improves the metabolism of nitrogen, phosphorus and potassium. Tiger-Sul is headquartered in Shelton, CT (near New Haven) and has operating facilities in Atmore, AL; Stockton, CA; Irricana, AB; and Shanghai, China (www.tigersul.com).

“For more than 50 years, Tiger-Sul has been providing farmers around the globe with high quality sulphur bentonite and micronutrient fertilizers, pushing the boundaries of innovation in the industry,” said Don Cherry, CEO of Tiger-Sul. “Platte River has the resources and experience to help us accelerate the company’s growth in the global market.”

“We were attracted to Tiger-Sul because of its reputation in the agriculture industry for superior products and a consistent ability to deliver product innovations to address the needs of its end customers,” said Kris Whalen, Managing Director of Platte River.

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).

The investment in Tiger-Sul was made by Platte River out of its third fund, Platte River Equity III, LP.

© 2016 Private Equity Professional | December 21, 2016

Lake Pacific Ends 14-Year Hold of Maxi

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Lake Pacific has sold Maxi Holdings, a maker and seller of chicken products that are sold to the grocery, mass market, and club retailers in the US and Canada, to Altamont Capital Partners.

Maxi’s frozen chicken products include sticks, patties, tenders, and nuggets that are marketed under the Yummy brand and are available in more than 25,000 retail outlets. The company’s Dino Buddies, a popular product aimed at families with young children, are the top selling children’s chicken nugget in the US. The company is based near Montreal in Saint-Lin–Laurentides (www.maxi.com) and the company’s plant and offices will remain in Saint-Lin-Laurentides under Altamont ownership.

In October 2002, Lake Pacific invested in Maxi Holdings (then Maxi Poultry Co. Ltd.) to help the company expand manufacturing capacity and reposition the company as a branded products maker. Maxi was founded in 1970 by Joseph Friedmann and began automated production of its chicken products in 1995.

“During our ownership of Maxi, the company achieved dramatic growth, added capacity, shifted away from foodservice and industrial markets, built well-known brands and greatly expanded retail distribution. Today, its customers include a majority of the top grocery retailers, club wholesalers and mass merchants in North America,” said William Voss, Managing Director of Lake Pacific.

Lake Pacific invests in companies with $25 million to $250 million in sales that are active in the food, beverage, consumer products, consumer services, distribution, packaging, and business services sectors. The firm was founded in 2000 by William Voss and is headquartered in Chicago (www.lakepacific.com).

Altamont Capital Partners, the buyer of Maxi, invests in middle-market businesses with specific interest in the financial services, government services, consumer/retail, industrials and healthcare sectors. Altamont was formed in 2010 by Jesse Rogers, Randall Eason and Keoni Schwartz who previously worked together at Golden Gate Capital and Bain & Company. The firm has more than $2 billion of capital under management and is based in Palo Alto (www.altamontcapital.com).

Tim Bruer, an Altamont operating partner and CEO of Tall Tree Foods (an Altamont portfolio company), will lead the existing management team of Maxi as Executive Chairman to drive geographic growth across the US and the development of new products. Managing Director Casey Lynch led the transaction for Altamont.

Financing for the acquisition was provided by Royal Bank of Canada, National Bank of Canada and Bank of America Merrill Lynch. Houlihan Lokey was the financial advisor to Maxi Holdings.

© 2016 Private Equity Professional | December 21, 2016

 

 

Harren Acquires MedPro

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Harren Equity Partners has acquired Management Health Systems (MedPro), a provider of medical staffing services.

MedPro is a provider of medical staffing, including registered nurses, allied health professionals, physical therapists, and medical technologists, to healthcare providers throughout the US. MedPro’s customers includes acute care hospitals, skilled nursing facilities, home health companies, outpatient centers, dialysis centers, and lab facilities. The company’s base of clinical professionals are recruited from various countries around the world and provide both temporary travel staffing services as well as temporary-to-permanent staffing services. The company is led by CEO Liz Tonkin and is based west of Ft. Lauderdale in Sunrise, FL (www.medprostaffing.com).

“As we look forward to driving continued growth and expansion, the partnership with Harren will be extremely valuable in terms of facilitating access to financial as well as strategic resources. Given Harren’s experience working with similar businesses, we felt like they were the right partner to help us execute on our long-term goals,” said Ms. Tonkin.

The buy of MedPro is the fourth platform investment made by Harren out of its third fund, Harren Investors III, which closed in July 2013 with $275 million of capital. The investment continues Harren’s track record of backing management teams at leading businesses with high growth potential within the healthcare industry.

In recent years, Harren has increased its focus on investing in healthcare services with the addition of a dedicated healthcare partner, C. Taylor Cole, Jr., in April 2014. Prior to joining Harren, Mr. Cole was a member of Charterhouse Group, a middle market private equity firm based in New York, where he was responsible for the firm’s healthcare investment activities. “MedPro’s leadership team consists of highly regarded industry thought leaders who have pioneered a unique and differentiated growth strategy in a rapidly expanding market that we at Harren know well,” said Mr. Cole. “MedPro was seeking a partner who understands its business strategy and operating model as well as the nuances and dynamics surrounding the market in which it competes. Harren is delighted to have been chosen as the right partner moving forward.”

Harren invests in companies with revenues of $20 million to $200 million and EBITDAs of at least $5 million. Sectors of interest include aerospace and defense; building products; business services; consumer products, energy services; general industrial; healthcare services; restaurants; and specialty distribution. The firm, based in Charlottesville, VA, has more than $250 million of capital under management and was founded by Managing Partner Thomas Carver in 2000 (www.harrenequity.com).

Harren’s current healthcare portfolio companies include Persante Healthcare, a provider of sleep disorder diagnostic and therapeutic services, and Med-Legal, a provider of technology-enabled record retrieval and review services in the workers’ compensation and personal injury markets.

© 2016 Private Equity Professional | December 21, 2016

Blue Wolf Takes EPP Auction

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Blue Wolf Capital Partners has acquired Extreme Plastics Plus (EPP), an environmental containment company that serves the domestic oil and gas industry.

Impacted by the cyclical decline in the US energy markets, EPP filed for Chapter 11 bankruptcy protection on January 31, 2016. On October 20, Blue Wolf was named the stalking horse bidder for the assets of EPP by the United States Bankruptcy Court (Delaware) and prevailed in an auction held on November 17, 2016. The buy of EPP was made through Blue Wolf Capital Fund III, LP. Blue Wolf’s investment has allowed EPP to exit bankruptcy with a debt-free balance sheet and should position the company to benefit from an eventual oil and gas market recovery.

EPP provides a variety of environmental containment services including environmental liner installation, above ground storage tank rentals and composite mat rentals. Customers of EPP are oil and gas companies operating in the Marcellus, Utica, Eagle Ford, Permian and Mid-Continent basins. The company was founded in 2007 and is headquartered in Fairmont, WV with additional locations in Pennsylvania, Texas, Oklahoma and New Mexico (www.extremeplasticsplus.com).

This transaction is the first investment from a partnership Blue Wolf entered into earlier this year with K2 Energy Capital and its founder, Kevin Kuykendall, to pursue energy services investments.  The current EPP management team, including Founder and President Bennie Wharry, will remain with the company.

“We believe EPP’s environmental containment solutions are best-in-class and will be in high demand as the energy sector gets back on track,” said Adam Blumenthal, Managing Partner of Blue Wolf. “We are excited to have closed our first investment with K2 and to work alongside Bennie and the entire EPP team as we steer the company towards long-term success.”

Blue Wolf invests in companies in which management of relationships with complex constituencies – such as government and labor – can change organizations and create value. The firm’s investment criteria are minimum revenues of $25 million; minimum transaction size of $20 million; and a minimum investment size of $10 million. The firm focuses its efforts on companies based in the United States and Canada. Blue Wolf is currently investing its third fund with $300 million in limited partner equity commitments. The firm is headquartered in New York (www.blue-wolf.com).

K2 Energy Capital invests in the energy services sector, including oilfield services, utility services, and equipment manufacturing. The firm is based in Dallas (www.k2energycapital.com).

© 2016 Private Equity Professional | December 21, 2016