Wind Point Partners has acquired Paragon Films, a maker of stretch films used in storage and transit applications.
According to Wind Point, Paragon is a market leading manufacturer of high performance cast stretch films that are used to unitize loads while in storage and transit. The company sells its products in all 50 states, as well as Canada, Mexico, South America and a number of other international locations. Paragon operates three manufacturing facilities: Broken Arrow, OK (opened at founding in 1988); Taylorsville, NC (opened in 2005); and Union Gap, WA (opened in 2013). The company was founded in 1988 by Mike Baab who will remain a significant investor and a member of the board under Wind Point ownership. Paragon is headquartered southeast of Tulsa in Broken Arrow (www.paragonfilms.com).
“Wind Point is the perfect fit with Paragon’s culture and core values,” said Mr. Baab. “This partnership will provide Paragon with the opportunity to pursue tremendous growth and will benefit our customers and employees which was my most important goal as I begin to transition into retirement. I am thankful that Wind Point will allow Paragon to continue its vision and goals.”
As part of the transaction, Wind Point is partnering with Stan Bikulege, who will serve as Paragon’s non-executive Chairman, and Darin Tang, who will join Paragon as CEO.
Mr. Bikulege is a Wind Point advisor and the current Chairman and CEO of Novolex, a manufacturer of flexible paper and plastic packaging products. Wind Point invested in Hilex Poly (Novolex’s predecessor) in 2012 and under Mr. Bikulege’s leadership the company grew from $500 million to over $2 billion in revenue. In November 2016, Wind Point agreed to sell Novolex to The Carlyle Group.
Mr. Tang was most recently Senior Vice President of Strategic Packaging Solutions ($2.8 billion in revenue) at Veritiv, an Atlanta-based paper and packaging distributor that was formed in 2014 through the merger of International Paper’s XpedX and Unisource Worldwide. Prior to Veritiv, he was President of Unisource Worldwide’s Packaging Solutions Group ($1.3 billion in revenue) and oversaw over 650 employees across multiple countries.
“We are excited to acquire Paragon and invest in the next phase of its growth,” said Alex Washington, a Managing Director at Wind Point. “Mike Baab has built a phenomenal company with best-in-class technical leadership. Wind Point has a proven strategy of working with family-owned companies to navigate leadership transition. With Stan and Darin’s complementary experience and track records for creating value in the packaging and industrial film markets, we look forward to continued success.”
Wind Point invests from $20 million to $70 million of equity in companies with revenues from $100 million to $500 million and EBITDAs of at least $8 million. Industries of interest include business services, consumer products, healthcare and industrial products. Wind Point is an active investor in the packaging industry having recently acquired Burrows Paper (expected to close by year end), Heritage Bag (2016), Wisconsin Film & Bag (2015), Duro Bag (2014), and Packaging Dynamics (2014).
Financing for the transaction was provided by NewStar Financial, Antares, BMO Capital Markets, BlackRock Capital, and Northwestern Mutual Capital. KPMG provided transaction advisory services to Wind Point on the transaction. Blaige & Company served as financial advisor to Paragon.
Wind Point Partners was founded in 1984 and is based in Chicago (www.wppartners.com).
© 2016 Private Equity Professional | December 15, 2016
