Archives for July 11, 2017

WILsquare Acquires Walcro

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WILsquare Capital has acquired Walcro, a Midwest-based distributor of flooring installation products.

Walcro is one of the oldest installation supply distributors in the United States. The company – with more than 5,000 SKUs sourced from more than 100 vendors – distributes tools, supplies, accessories and building products that are used in the installation of carpet, ceramic, stone, resilient, laminate and wood flooring. Walcro has 17 stocking locations in Minnesota, North Dakota, South Dakota, Nebraska, Iowa and Wisconsin. The company was founded in 1971 by Warren Kelly and is headquartered near Minneapolis in Bloomington, MN (www.walcro.com).

“WILsquare Capital is extremely pleased to build a relationship with the Kelly family, which allows for us to invest in the legacy they have created over the past 37 years in establishing Walcro as the leading source of flooring installation products,” said Bill Willhite, Managing Partner at WILsquare Capital. “With 17 locations across a six-state area, Walcro’s longstanding relationships with market-leading product manufacturers and its strong team of customer service professionals allow the company to deliver an unrivaled combination of product, knowledge and service to its customers.”

WILsquare invests in businesses that are located in the Midwest and South that are often family-owned and have EBITDA of $3 million to $10 million. Sectors of interest include business services, niche manufacturing, distribution and technology companies. The St. Louis-based firm was co-founded in 2015 by William (Bill) Willhite and James (Jamie) Wilmsen (www.WILsquare.com).

“I am extremely pleased with our partnership with WILsquare Capital and excited about the opportunities for our employees that will be created in taking Walcro to the next level of growth and success,” said Warren Kelly, owner of Walcro. “I am confident WILsquare will preserve the legacy we have built over the years with our outstanding team of customers and vendors.”

According to WILsquare, Warren Kelly, along with his sons, Bill and Sean Kelly, have established Walcro as the “go to” provider of flooring installation solutions. The strong Kelly family values permeate throughout the organization and are the foundation of its customer service and delivery model.

“We are very appreciative of the trust Warren, Bill and Sean have placed in WILsquare Capital to execute Walcro’s next stage of growth,” said James Wilmsen, Partner at WILsquare Capital. “With Bill Kelly’s continued involvement as CEO of the organization along with Warren serving as an advisor to the Board and Sean advising on the transition, we are excited about the opportunity to grow Walcro’s business with existing customers and new customers in areas outside of Walcro’s current six-state area. We look forward to supporting Walcro’s investment in innovative product solutions as well as additional locations to better serve its customer base.”

The buy of Walcro was made through WILsquare Capital Partners Fund I, LP.

© 2017 Private Equity Professional | July 11, 2017

Audax Buys EnviroVac from RLJ

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Audax Private Equity has acquired EnviroVac, a provider of industrial cleaning and maintenance services, from RLJ Equity Partners.

EnviroVac is a provider of industrial cleaning and maintenance services. The company utilizes high-pressure washing and vacuum equipment to service companies operating in the pulp and paper, chemical, steel, oil and gas, and power industries. EnviroVac often serves as an in-house provider with embedded equipment and personnel on-site at customer facilities. The company, founded in 1998, operates ten facilities located in Louisiana, Mississippi, Alabama, Georgia, South Carolina, and North Carolina. EnviroVac is headquartered in Savannah, GA (www.cleancompany.com).

“Partnering with Audax provides access to a broad range of resources, enabling EnviroVac to reach new heights in the industrial cleaning industry, grow into new market segments and service lines, and complete additional strategic acquisitions,” said Kevin Jackson, CEO of EnviroVac.

“EnviroVac is a leader in the industrial cleaning industry. We are excited to partner with Kevin Jackson and the rest of the EnviroVac team and support them in this next phase of growth,” said Geoffrey Rehnert, Co-Chief Executive Officer of Audax.

The Audax Group makes control investments of $10 million to $100 million in middle market companies with transaction values of $25 million to $500 million. Sectors of interest include industrial manufacturing; energy; outsourced industrial services; consumer products; healthcare devices and services; non-asset based logistics; technology; aerospace & defense; business services; and direct marketing. The firm was founded in 1999 and has offices in Boston, New York and Menlo Park (www.audaxgroup.com).

RLJ Equity Partners acquired EnviroVac in June 2014 from Miami-based Pine Tree Equity Partners. “Since our investment three years ago, EnviroVac has thrived under the leadership of their President & CEO Kevin Jackson,” said Jerry Johnson, Managing Director at RLJ Equity Partners. “EnviroVac achieved considerable growth as a result of its intentional focus on innovation, customer service, and the integration of a significant strategic acquisition, which enabled EnviroVac to serve the Southeast by providing comprehensive services, thereby boosting revenues. We are proud to have been an instrumental part of EnviroVac’s success.”

RLJ Equity Partners invests from $15 million to $30 million in companies valued between $50 million and $250 million. Target companies will have operating profits greater than $7 million and operating margins greater than 10%.  Sectors of interest include aerospace & defense; auto & transportation; business services; consumer retail; general industrial; and media & telecom.  RLJ Equity Partners was founded in 2006 by Robert Johnson in partnership with The Carlyle Group. The firm is headquartered in Bethesda, MD (www.rljequitypartners.com).

Twin Brook Capital Partners, the middle market direct lending subsidiary of Angelo, Gordon & Co., was the sole lead arranger and administrative agent for the debt facilities that supported Audax’s buy of EnviroVac. Twin Brook (www.twincp.com) focuses on loans to companies with EBITDA between $3 million and $50 million. The firm is led by Trevor Clark and Christopher Williams, two of the original founders of Madison Capital Funding.

Houlihan Lokey was the financial advisor to EnviroVac.

© 2017 Private Equity Professional | July 11, 2017

IOP Hits Fund III Hard Cap

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Industrial Opportunity Partners (IOP) has closed its third fund, Industrial Opportunity Partners III, LP, with $450 million of committed capital.

The new fund held a single close on June 30, 2017, and hit its hard cap after a three-month fundraising process. The original target for the fund was $400 million. Limited partners in Fund III include university endowments, foundations, insurance companies, pension plans, and funds-of-funds.

“We are pleased to have completed raising Fund III so quickly and with such strong demand,” said Kenneth Tallering, Senior Managing Director of IOP. “We appreciate the support and confidence of our investors, and we look forward to the opportunity to create value in our Fund III portfolio companies.”

IOP focuses on acquiring middle-market manufacturing and value-added distribution businesses, typically with revenues between $30 million and $350 million. The firm targets businesses with strong product, customer, and market positions and provides both management and operational resources to support sales growth and operational improvements. IOP was founded in 2005 and is headquartered in the Chicago suburb of Evanston (www.iopfund.com).

According to IOP, the firm differentiates itself from other investors by its operating resources led by its dedicated, full-time Board of Operating Principals – a group of executives, each with over 25 years of experience, who guide and assist management teams in stabilizing, enhancing, and growing the value of their businesses. “We believe the talents of our team continue to resonate with our investors and enable IOP to pursue and create value in a broad spectrum of investment situations,” said IOP Senior Managing Director Robert Vedra. “Further, we believe that IOP’s Board of Operating Principals has been a key factor in creating value in our portfolio companies and providing consistency in our returns to investors.”

IOP’s first fund totaled $185 million of committed capital and was raised in 2006 and 2007. Fund I has completed 11 platform investments, seven add-on acquisitions, and seven realizations. IOP’s second fund totaled $275 million of committed capital and was raised in 2012. Fund II has completed 11 platform investments, two add-on acquisitions and two realizations. The portfolio companies of both these earlier funds serve a variety of end markets, including transportation, construction, agriculture, building products, packaging, and general industrial. No portfolio companies have been acquired yet for Fund III.

Park Hill Group was the placement agent on this fund raise.

© 2017 Private Equity Professional | July 11, 2017

New MD at Z Capital

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Z Capital Group has hired Benjamin Webster as a new Managing Director. He is responsible for investor development for the firm’s private equity and credit funds and is based in Z Capital’s suburban Chicago office.

Mr. Webster joins Z Capital from BlackRock, where he most recently served as Director of the firm’s Institutional Client Business. He began working at Blackrock in May 2014. Previously, from 2004 to 2014, Mr. Webster served as Vice President in Institutional Wealth Services at Fidelity Investments. From 2002 to 2004 he was a Regional Vice President at Genworth Financial.

“We are thrilled to welcome Ben to Z Capital as we continue to bolster our capabilities on our leading investor development team,” said James Zenni, President, Founder and Chief Executive Officer of Z Capital Group. “With decades of experience and deep relationships with institutional, family office and high net worth investors, Ben will undoubtedly be an impactful addition to our firm.”

Z Capital makes control investments in middle-market distressed companies, operational turnarounds and special situations. The firm targets companies with an enterprise value of less than $1 billion or EBITDA of less than $100 million. Sectors of interest include consumer products, steel and steel processors, agricultural, gaming, leisure, real estate, manufacturing, specialty services and automotive. Z Capital is based in the Chicago suburb of Lake Forest and has additional offices in New York and Zurich (www.zcapgroup.net).

“I am delighted to join the world-class team at Z Capital,” said Mr. Webster. “I look forward to leveraging my institutional, private client and consulting experience to help attract and retain high-caliber limited partners and support the firm’s new business initiatives.”

© 2017 Private Equity Professional | July 11, 2017