April 12, 2017
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Archives for April 12, 2017

Riverside Adds Parkwood to Ownership

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The Riverside Company has sold a non-voting minority equity interest in itself to Parkwood LLC, an institutional limited partner in multiple Riverside funds.

“Parkwood has a deep understanding of Riverside including our strategy, market leadership and culture,” said Riverside Co-CEO Stewart Kohl. “This is a natural extension of our mutually beneficial relationship. I’ve long admired Parkwood Chairman and CEO Morton Mandel as a mentor and role model, so we’re especially happy to have them as a partner in growth.”

Mr. Mandel is an American business magnate, entrepreneur, and philanthropist. Along with his two brothers, Jack and Joe, he founded the Premier Industrial Corporation in 1940, which later became one of the world’s leading industrial parts and electronic components distributors. He is well known for his philanthropic activities in Cleveland, and in Jewish and Israeli institutions. Parkwood LLC, the Mandel family’s private investment company, is headquartered in Cleveland (www.parkwoodcorp.com).

Parkwood’s acquisition of just under 10% of the firm will be all primary capital. “This investment is a natural element of Riverside’s three-decades of growth and its position as a leader at the smaller end of the middle market,” said Riverside Co-CEO Béla Szigethy. “We’re excited about getting more resources to help us become even more proficient at growing companies.” Riverside has also recently put in place an employee stock option plan to retain and reward employees.

“Parkwood prides itself on working with great people, adhering to rigorous processes and focusing on cultural fit. We have been a significant private equity investor for over 40 years including with many marquee firms,” said Mr. Mandel. “Partnering with Riverside in this way is a perfect fit for our strategy and culture.”

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 460 transactions. The firm’s international portfolio includes more than 80 companies. The firm is headquartered in New York with 16 additional US and international offices (www.riversidecompany.com).

© 2017 Private Equity Professional | April 12, 2017

Trinity Hunt Builds Auction Biz

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America’s Auto Auction, a portfolio company of Trinity Hunt Partners since April 2015, has continued its expansion with the buy of Grand Rapids-based West Michigan Auto Auction.

On a weekly basis West Michigan Auto Auction (WMAA) consigns over 1,000 cars and has over 900 attending dealers at its sales. In addition to its auction services the company provides other services including mechanical and inspection; transportation; and reconditioning. WMAA has two locations in Grand Rapids and Parma, MI and was founded in 1996 (www.wmaa.net).

America’s Auto Auction specializes in wholesale auctions of automobiles on behalf of new car dealers, fleet lease businesses, repossession companies, and used car dealers.  The company, led by CEO Ben Lange, was founded in 2005 and is headquartered in Dallas (www.americasautoauction.com).

The buy of WMAA continues America’s Auto Auction’s nationwide growth and expands its market presence to 21 locations across the country. “This acquisition represents a compelling opportunity to add two high-quality auction locations to the America’s Auto Auction platform,” said Mr. Lange. Last month, America’s Auto Auction acquired Indianapolis-based Auction Broadcasting Company, a full service auto auction company offering transportation, full and partial reconditioning, telemarketing, in-house restaurants, auctioneers and ringman (bid spotters), and on-line bidding capability.

“We are excited to continue to build out America’s Auto Auction’s geographic footprint through this acquisition,” said Dan Dross, Managing Partner of Trinity Hunt. “The acquisition of West Michigan Auto Auction represents the continued execution of the value creation plan we developed in partnership with management when we invested in the company.”

Trinity Hunt invests in companies that have EBITDAs between $5 million and $25 million and enterprise values between $25 million and $150 million. Sectors of interest include B2B business services, niche manufacturing, industrial services, non-cyclical consumer and healthcare services. Trinity Hunt is based in Dallas (www.trinityhunt.com).

© 2017 Private Equity Professional | April 12, 2017

Trive Adds-on to AGM

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Architectural Granite & Marble, a portfolio company of Trive Capital, has acquired Pental Surfaces, a wholesale distributor of natural stone, porcelain, ceramic, glass and metal tile and mosaics.

Pental Surfaces has showrooms in Seattle, Denver, Los Angeles, Fife (near Tacoma) and Portland and sells its products largely to customers in 11 western states including: Washington, Oregon, California, Montana, Idaho, Utah, Colorado, Alaska, Hawaii, Wyoming, and Nevada. Pental Surfaces was founded in 1999 by Peter Pental and is headquartered in Seattle (www.pentalonline.com).

Trive Capital acquired Architectural Granite & Marble (AGM), an importer and distributor of natural and engineered stone that is used in residential and commercial construction, in July 2015. Customers of AGM include countertop fabricators, architects, interior designers, and commercial contractors.  AGM was founded in 1992 and has eight locations across the US.  The company is headquartered northwest of Austin in Spicewood, TX (www.agmgranite.com). Sunil Palakodati is the CEO of AGM and upon closing of the transaction Mr. Pental assumed the title of President.

According to Trive, the buy of Pental creates a leading distributor of interior surfaces including natural stone, engineered stone, and tile with 13 locations across the United States. “This merger is the result of a relationship amongst Peter and Ravi Pental and Trive that began in 2014.  Trive has been thoroughly impressed with the cohesive team and high quality business forged by the Pentals.  We are excited to provide the financial and operational support to combine these great businesses, unlock significant growth opportunities, and build a differentiated platform in the sector,” said Dan Lenahan, Managing Director at Trive Capital.

Trive Capital invests from $10 million to $60 million in North America headquartered companies with revenues of $30 million to $500 million. Sectors of interest include automotive & transportation; aerospace & defense; building products; construction & infrastructure; consumer goods; energy services; healthcare; manufacturing and industrials; chemicals; distribution; business & professional services; and communications. The firm was founded in 2012 by Conner Searcy, Managing Partner, and Chris Zugaro, Partner. Trive Capital is based in Dallas (www.trivecapital.com).

“This merger brings together two highly complementary businesses, creating a stronger, more diversified company with the ability to offer greater opportunities to our customers, suppliers, and employees.  We plan to leverage our strengths to pursue continued above-market growth through new location openings and strategic acquisitions,” said Mr. Searcy.

“Today is a momentous day for both companies,” said Mr. Palakodati. “We believe Pental Surfaces has built an unrivaled reputation on the West Coast and is an ideal partner for AG&M, enabling us to extend our combined geographic presence to serve our customers with innovative products and value-added service solutions.”

© 2017 Private Equity Professional | April 12, 2017

Baird’s Alpha Buys Medical Optics

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Alpha Source, a portfolio company of Baird Capital, has acquired Medical Optics, a provider of endoscope and surgical instrument repair.

Medical Optics repairs and restores any medical equipment that a surgeon might hold in their hand such as flexible endoscopes; rigid/semi-rigid endoscopes; power equipment; surgical instruments; cameras; fiber optic cable; micro instruments; and diamond knifes. The company provides its service to clients located throughout North and South America, Europe, Asia and Australia. Medical Optics was founded by Frank Malvasio in 1997 and is headquartered near Ft. Lauderdale in Tamarac, FL (www.medicaloptics.com).

Alpha Source, acquired by Baird in April 2015, has four ISO-certified and FDA registered operations: a nationally scaled imaging service division; depot repair operations; manufacturing of OEM quality medical battery packs; and distribution and logistics of over 60,000 SKUs of biomed parts, supplies and accessories. The company is led by CEO Rick Lytle and is headquartered in Milwaukee (www.alphasource.com).

“Our acquisition of Medical Optics is part of an ongoing growth strategy to expand our comprehensive portfolio of medical equipment parts, field service and depot repair options,” said Mr. Lytle.  “We are also pleased by the continued operational and investment support from our private equity sponsor Baird Capital.”

Baird Capital invests in lower middle-market companies in the manufactured products, healthcare and business services sectors. The firm invests from $15 million to $35 million in companies with enterprise values of $25 million to $125 million and EBITDAs greater than $5 million. Baird Capital was founded in 1989 and is based in Chicago with additional offices in Milwaukee, London and Shanghai (www.bairdcapital.com).

© 2017 Private Equity Professional | April 12, 2017

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