February 24, 2017
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Archives for February 24, 2017

Blue Point Acquires FLSA

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Blue Point Capital Partners has acquired Fire & Life Safety America, a provider of fire and life safety system inspection, maintenance, repair and installation services. This buy is the seventh platform investment for Blue Point’s third fund which closed in November 2014 at the hard cap of $425 million.

According to Blue Point, Fire & Life Safety America (FLSA) is one of the nation’s largest fire and life safety services providers and a large percentage of the company’s revenue comes from recurring inspection and monitoring accounts. FLSA services fire alarms, sprinkler systems, fire pumps, pipe/hose systems, fire extinguishers, kitchen hood suppression and emergency and exit signs.  The company has approximately 800 employees and services customers from fifteen branch locations in the mid-Atlantic and southeastern United States, as well as through a national partner network. FLSA, led by CEO Tom York, was founded in 1997 as East Coast Fire Protection and is headquartered in Richmond, VA (www.flsamerica.com).

Blue Point Capital Partners acquired FLSA from PNC Riverarch which acquired the company from KRG Capital in June 2015. KRG Capital was the company’s first institutional investor when it invested in East Coast Fire Protection in October 2005. FLSA has completed numerous add-on acquisitions under its private equity owners including the buys of Southeast Fire Protection, Affordable Fire Protection, Fire Watch Services, Elite Fire Protection, Texas Southwest Fire Protection, and Universal Sprinkler.

“Blue Point has a proven track record of investing in business-to-business service models and developing growing businesses into national leaders; FLSA is an ideal platform for the firm,” said Juli Marley, a Partner with Blue Point.  “We are thrilled to partner with this talented management team and support their efforts to expand the service segment, green field new locations and identify strategic acquisitions.”

Blue Point Capital Partners is a lower middle market private equity firm that invests in manufacturing, distribution and service businesses that have from $20 million to $200 million in revenue. The firm has over $800 million in committed capital and has offices in Cleveland, Charlotte, Seattle, and Shanghai (www.bluepointcapital.com).

PNC Riverarch, the seller of FLSA, invests from $10 million to $50 million in privately-held companies headquartered throughout North America. Sectors of interest include outsourced services, specialized manufacturing, and value-added distribution. PNC Riverarch is a division of PNC Capital Finance which in turn is a subsidiary of The PNC Financial Services Group (NYSE: PNC). PNC Riverarch is based in Pittsburgh (www.pncriverarch.com).

© 2017 Private Equity Professional | February 24, 2017

LaSalle Acquires Orion Financial

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MetaSource, a portfolio company of LaSalle Capital, has acquired Orion Financial Group. Orion represents LaSalle Capital’s fourth add-on investment to the MetaSource platform since it acquired the company in November 2013.

Orion Financial Group provides real estate document recording services, including mortgage assignments, lien releases, and document retrieval services to mortgage servicers, investors, credit unions, and lenders. The company performs its real estate document recordings in all 3,600 US counties. Orion is based near Dallas in Southlake, TX (www.orionfgi.com).

The acquisition of Orion expands MetaSource’s service offering focused on mortgage quality control, compliance advisory, and technology-enabled workflow services. “MetaSource is widely regarded as a rapidly growing, respected leader in the mortgage services space and we look forward to contributing additional growth to the platform,” said Mike Wileman, CEO of Orion.

MetaSource is a provider of technology-enabled BPO services with a focus on the financial services, healthcare and retail industries. The company offers a range of services including document processing, customer care and content management. MetaSource is based south of Salt Lake City in Draper, UT (www.metasource.com).

“Adding Orion to the MetaSource family perfectly complements the compliance solutions line-up of our current portfolio,” said MetaSource CEO, Adam Östhed. “We are delighted to welcome Orion’s team of experts to MetaSource.”

LaSalle Capital makes control investments of $10 million to $20 million in companies with revenues from $20 million to $100 million and EBITDA greater than $3 million. Sectors of specific interest include food & beverage and outsourced business services. The firm is currently investing out of its second fund which held a final closing in May 2012 with $205 million in commitments. Fund II is the successor to the firm’s inaugural $125 million Fund I which closed in 2005. LaSalle Capital is based in Chicago (www.lasallecapitalgroup.com).

© 2017 Private Equity Professional | February 24, 2017

Carlyle Closes Latest Fund

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The Carlyle Group has raised $2.5 billion for its fourth distressed and special situations fund, Carlyle Strategic Partners IV (CSP IV). The fundraising effort is more than triple the size of the previous fund and closed at the hard cap.

The CSP team in New York and London invests in the debt and equity of companies in the US, Europe and Asia experiencing financial, operational or cyclical distress. The fund has the flexibility to invest throughout the capital structure of a company in bank loans, public debt, public and private equity.

“Carlyle Strategic Partners IV builds on the team’s demonstrated ability to find attractive investments, establish control or exert influence, and drive value through operational improvements to generate compelling risk-adjusted returns,” said Shary Moalemzadeh, Managing Director and Co-head of CSP. “With the support of the Carlyle network, CSP IV is poised to source an increasing number of proprietary deals across an array of industries where we have deep sector expertise.”

Carlyle Strategic Partners is part of Carlyle’s global credit platform. The credit platform resides within the Global Market Strategies segment, which had $29 billion in assets under management as of December 31, 2016, and has 149 investment professionals in New York, Washington DC, Los Angeles, Chicago, Hong Kong and London.

The current global economic and market environment is laying the groundwork for solid distressed control and turnaround investment opportunities.
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Since 2004, the group has raised approximately $4.8 billion and invested in companies including Metaldyne, an automotive supplier of components for engines and transmissions; Brintons, a specialized global carpet manufacturer; Service King, one of the largest independent US chains of auto body repair shops; and Akari, an elderly nursing and residential home care provider in the UK.

“The current global economic and market environment is laying the groundwork for solid distressed control and turnaround investment opportunities.  We believe our experience and approach positions us well to capitalize on the best of these opportunities during the cycle,” said Ian Jackson, Managing Director and Co-head of CSP.

The Carlyle Group (NASDAQ: CG) invests in buyouts, growth capital, real estate and leveraged finance in Africa, Asia, Australia, Europe, North America and South America. Carlyle has expertise in various industries, including: aerospace, defense & government services, consumer & retail, energy, financial services, healthcare, industrial, real estate, technology & business services, telecommunications & media and transportation.  The firm employs approximately 1,600 people in 35 offices across six continents and is based in Washington, DC (www.carlyle.com).

© 2017 Private Equity Professional | February 24, 2017

CM Equity Exits PSS

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CM Equity Partners has agreed to sell its portfolio company Preferred Systems Solutions (PSS) to publicly-traded STG Group for a total consideration of approximately $119 million. This transaction is expected to close before the end of March. CM Equity Partners acquired PSS in September 2007.

PSS is a provider of software engineering & development; cyber security; cloud computing; systems engineering & technical assistance; business applications and financial management; and program and acquisition management services. Customers include the intelligence services, US Army, US Navy, Defense Logistics Agency, US Transportation Command, Defense Advanced Research Project Agency (DARPA), Federal Bureau of Investigation (FBI), and the Departments of Homeland Security and Transportation, among others. PSS is led by CEO Scott Goss and is headquartered in McClean, VA (www.pssfed.com).

“We are extremely pleased to become part of the STG Group as it will significantly increase our ability to provide an expanded set of advanced technology capabilities across the broad spectrum of critical national security programs,” said Mr. Goss. “The company’s commitment to outstanding customer support enables world class services in support of our country’s warfighters and the federal civilian workforce working daily to safeguard our country.”

CM Equity Partners makes control and minority investments of $5 million to $40 million in companies with $20 million to $200 million in revenues and $3 million to $20 million of EBITDA. Sectors of interest include federal services and aerospace & defense. The firm has made more than 70 acquisitions and investments since its founding in 1992. CMEP is associated with Carl Marks & Co., a private family investment office with merchant banking activities dating back to 1925. CMEP is based in New York (www.cmequity.com).

STG Group (OTC: STGG) is a provider of technology, cyber, and data services to more than 50 defense, intelligence, federal, and other national security agencies. The company was formerly known as Global Defense & National Security Systems and changed its name to STG Group, Inc. in November 2015. The company was founded in 1986 and is headquartered in Reston, VA (www.stg.com).

“We are excited to announce the next step in our transformation strategy for STG Group. With the acquisition of PSS, we are advancing our technological agility and ingenuity to meet the most complex and demanding national security challenges facing the US,” said STG President Phillip Lacombe.

Sagent Advisors, an investment bank with offices in New York, Chicago and McLean, VA (www.sagentadvisors.com), was the financial advisor to STG Group on this transaction.

© 2017 Private Equity Professional | February 24, 2017

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