Archives for November 27, 2017

Svoboda Sells B&P

by

Svoboda Capital Partners has sold Blake & Pendleton to Five Points Capital and members of the company’s senior management team. Svoboda acquired Blake & Pendleton in June 2013 from KLH Capital.

Blake & Pendleton (B&P) is a regional distributor of air compressors, compressed air automation systems, pumping equipment, and flow control products to companies operating in the manufacturing, textiles, food, automotive, and agriculture sectors. B&P also provides technical and service support on the equipment that it sells. The company was founded in 1971 and has approximately 160 employees at 14 locations in Alabama, Georgia, northern Florida, Mississippi, North Carolina, and Tennessee. B&P is headquartered in Macon, GA (www.blakeandpendleton.com).

Allen King, CEO of B&P, and the rest of the management team will continue forward with the company as collective majority stakeholders. “Our partnership with Svoboda Capital has been beneficial and enhanced the long-term growth and success of B&P,” said Mr. King. “As we move forward into the next phase, we are excited to build upon our strong foundation to continue growing our business.” Five Points Capital arranged the senior debt, provided the second lien financing and made a significant equity co-investment alongside the management team in this transaction.

“On behalf of Svoboda Capital Partners, it has been a pleasure to work with the team at B&P. Under Allen’s leadership, the team has built a strong organization that is committed to their customers and highly respected within the industry,” said Richard Harpster, Managing Director at Svoboda Capital Partners. “We are excited for the opportunity this gives management going forward as majority owners.”

Svoboda Capital invests from $10 million to $20 million in business services, value-added distribution, and consumer products companies that have revenues from $10 million to $100 million and EBITDAs from $3 million to $15 million. The firm was founded in 1998 and has over $300 million of capital under management.  Svoboda Capital is based in Chicago (www.svoco.com).

Five Points Capital (formerly known as BB&T Capital Partners) invests equity and subordinated debt in lower middle market buyout, acquisition, growth, and recapitalization transactions as a control investor on a standalone basis or as a co-investor with other financial sponsors.  Sectors of interest include business, healthcare and industrial services; niche manufacturing; value-added distribution; and education and training. The firm is headquartered in Winston-Salem, NC (www.fivepointscapital.com).

© 2017 Private Equity Professional | November 27, 2017

Gen Cap Buys Bargain Barn

by

Gen Cap America has acquired The Bargain Barn in partnership with the company’s management team.

Bargain Barn, which operates as United Grocery Outlet and GO Grocery Outlet, specializes in liquidating closeouts, factory seconds, irregulars, and overstocked products.  The company is one of the largest close-out grocery outlets in the eastern United States and operates 37 retail locations across Tennessee, North Carolina, Georgia, Kentucky, and Alabama.

Bargain Barn, with approximately 900 employees, was founded in 1974 and is based 180 miles southeast of Nashville in Athens, TN (www.myugo.com).

The Bargain Barn management team, led by Gary Buchanan, Don Whitted and Lisa Bryson, will stay on to run the daily operations of the business under Gen Cap America ownership. “We are extremely excited at the opportunity to partner with the top-notch management team at Bargain Barn,” said Gen Cap America Vice President Andrew Ginsberg. “We believe the company has a promising future ahead as they build on their long track record of providing value to customers and solutions to manufacturers.”

Gen Cap America invests in companies with revenues between $5 million and $100 million that are active in the manufacturing, distribution or service sectors. The firm is currently investing through Southwest Fund VII, a $250 million fund which had a final close at its hard cap in January 2017. Gen Cap was founded in 1985 and is based in Nashville (www.gencapamerica.com).

“Bargain Barn’s strong management team and long history of success made the company an excellent fit with Gen Cap America’s investment philosophy and we look forward to supporting the company in its next phase of growth,” said Barney Byrd, President of Gen Cap America.

The buy of Bargain Barn is the fourth acquisition completed by Gen Cap’s Southwest Fund VII within the past year. In November 2016 Gen Cap acquired Pyramyd Air, a Solon, OH-based distributor of air guns, airsoft guns and BB guns, as well as ammunition and related parts and accessories (www.pyramydair.com); in January 2017, Gen Cap acquired Gared, a Noblesville, IN-based manufacturer and marketer of athletic equipment to schools and other institutions. Products include equipment for basketball, volleyball, tennis, soccer, handball, field hockey, lacrosse, baseball and football (www.garedsports.com); and in July 2017 Gen Cap acquired Custom Plastic Specialties, an Erie, PA-based maker of promotional products including water bottles, stadium cups and steins, hand fans, tote bags, desk accessories, and other household and personal items that are sold exclusively to promotional products distributors (www.keystoneline.com).

© 2017 Private Equity Professional | November 27, 2017

Graham Acquires EasyPak

by

Graham Partners has acquired EasyPak, a thermoformed packaging provider to companies operating in the healthy and natural food markets.

EasyPak is a thermoformed packaging provider of simple single-material clamshell-type deli containers to more complex multi-layer-material MAP containers (modified atmosphere packaging or MAP enables fresh and minimally processed packaged food products to maintain visual, textural and nutritional appeal). The company’s products are made from traditional plastic polymers as well as from 100% post-consumer recycled materials.

EasyPak was founded in 2004 by Hector Echaniz and Marco Barbier and is headquartered near Boston in Leominster, MA (www.easypak.net).

“EasyPak is a strategic fit for the Graham portfolio due to our historical packaging expertise and related industry focus,” said Adam Piatkowski, a Managing Principal at Graham Partners. “The company has strong overlap with Graham’s packaging industry experience and end market overlap with other Graham portfolio companies in the natural foods industry. We have identified several opportunities to scale the business, while still maintaining its focus on customer service and technical excellence.”

According to Graham, thermoformed packaging is an attractive market to invest in with growth driven by increasing demand for sustainable packaging options and consumer preferences for freshly prepared, on-the-go meals.

Graham Partners acquires companies with EBITDA between $5 million and $50 million and will invest in smaller companies as add-on acquisitions to existing portfolio companies. The firm is sponsored by the Graham Group, an industrial and investment concern with interests in plastics, packaging, machinery, building products and outsourced manufacturing. Graham Partners was founded in 1988 and is headquartered in Philadelphia (www.grahampartners.net).

According to Graham, thermoformed packaging is an attractive market to invest in with growth driven by increasing demand for sustainable packaging options and consumer preferences for freshly prepared, on-the-go meals.

“Graham’s history uniquely qualifies them to assist us in growing our company,” said Marco Barbier, Managing Partner of EasyPak. “We are looking forward to collaborating with the Graham team and tapping into their industry and operational resources to enhance and grow EasyPak.”

© 2017 Private Equity Professional | November 27, 2017

SeaStar Sold by American Securities

by

American Securities has entered into an agreement to sell SeaStar Solutions to Dometic Group for $875 million. American Securities acquired SeaStar in January 2014 from H.I.G. Capital.

SeaStar Solutions is a provider of OEM and aftermarket products and accessories that are used in the recreational marine markets. The company’s products include electronic and hydraulic steering systems, controls and cables, engine and drive parts, instruments and displays, steering wheels, and hoses and clamps. Company-owned brand names include SeaStar, Sierra, BayStar, Shields, Inca, Mallory, Prime Line and Proheat.

SeaStar, led by CEO Yvan Cote, has approximately 1,250 employees and 8 facilities with a headquarters located 60 miles northeast of St. Louis in Litchfield, IL (www.seastarsolutions.com).

“We are proud to have supported Yvan and the talented SeaStar management team to drive organic growth and execute strategic acquisitions during our partnership,” said Scott Wolff, a Managing Director of American Securities. The most recent add-on completed by SeaStar was the July 2017 buy of Moeller Marine Products, a maker of fuel systems and other components for vessels ranging from bass and ski boats to offshore saltwater fishing craft (www.moellermarine.com).

“We are proud of our commitment to research and development, which has allowed us to regularly launch new and innovative products,” said Mr. Cote. “During our nearly four-year partnership with American Securities, they have been a valuable resource in achieving our growth objectives.”

American Securities invests in businesses with $200 million to $2 billion of revenue and $50 million to $300 million of EBITDA.  Sectors of interest include industrial manufacturing, specialty chemicals, aerospace and defense, energy, business services, healthcare, media, restaurants, and consumer products. The firm has more than $15 billion of capital under management and has offices in New York and Shanghai (www.american-securities.com).

Dometic Group (STO: DOM) manufactures and supplies mobile leisure products for recreational vehicles, and marine, commercial and passenger vehicles. Its products include awnings, air conditioners, refrigerators, ovens, stoves, windows, lights, doors, sanitation systems, and an array of additional products. The company’s products are sold through multiple distribution channels in more than 100 countries under the brands Dometic, WAECO, Marine Air, Cruisair, Condaria, SeaLand and Mobicool. Dometic has facilities in Asia, Europe and the United States and is headquartered near Stockholm in Solna, Sweden (www.dometic.com).

RBC Capital Markets and Baird were the financial advisors to SeaStar.

This transaction is expected to close before the end of 2017.

© 2017 Private Equity Professional | November 27, 2017