Spell Capital Partners has made an investment in Deacro Industries, a maker of slitting machines, roll slitters, rewinders and material handling equipment that is used in the converting industry.
Roll slitting is a shearing operation that cuts a large roll of material into narrower rolls. There are two types of slitting: log slitting and rewind slitting. In log slitting the roll of material is treated as a whole and one or more slices are taken from it without an unrolling or re-reeling. In rewind slitting the roll of material is unwound and run through the slitter, passing through knives or lasers, before being rewound on one or more shafts to form narrower rolls.
“Deacro has been in business for over 37 years and makes a fantastic machine; there’s tremendous value in that,” said Bill Spell, President and Founder of Spell Capital. “Additionally, the converting/flexible packaging industry is growing and Deacro’s machines are critical components to any expansion plans.”
Spell Capital Partners makes control investments of $3 million to $15 million in industrial manufacturing companies with revenues of at least $5 million and EBITDAs of at least $1 million. The firm, through Spell Capital Mezzanine, will also make subordinated debt investments of $3 million to $10 million in companies with EBITDAs of at least $2 million. The firm is based in Minneapolis (www.spellcapital.com).
In October 2016, Spell closed on its oversubscribed fifth fund, Spell Capital Partners Fund V, LP, with $68 million of capital commitments. The investment in Deacro is Spell’s second platform investment for Fund V. The first platform was the February 2016 buy of Atlas Wire, a manufacturer of polyvinyl chloride, nylon, and cross-linked polyethylene insulated wire used in a variety of applications including in the automotive, machine tools, industrial machinery, building and fixtures, and military sectors.
Deacro was founded in 1979 and has a state-of-the-art 75,000 square foot facility located near Toronto in Mississauga, ON (www.deacro.com). The company is led by its CEO Ed de Boer.
© 2016 Private Equity Professional | December 15, 2016
