Gryphon Investors has made a majority investment in Potter Electric Signal Company, a maker of specialty electronic and electromechanical products that are used in the fire safety industry. Gryphon acquired Potter from St. Louis-based private equity firm Two Rivers Associates which acquired the company in 2008 from the founding Potter family.
Potter develops, manufactures, and installs sprinkler monitoring, security, fire, and industrial control products for the sprinkler, fire alarm, and security industries worldwide. The company’s products are used in the commercial, industrial, multi-family, and residential end-markets in both the US and international markets. Potter’s products include fire sprinkler monitoring systems, fire alarm systems, power supplies, nitrogen/corrosion solutions, notification appliances, explosion-proof devices, voice systems, security notification, security switches, and other protection products.
According to Gryphon Investors, Potter is a market leader with a #1 share in the sprinkler monitoring products market and the company has been quickly gaining share in the fire alarm systems market. Potter was founded in 1898 by Charles E. Potter and has multiple locations in the US and also has offices in the UK and China. The company is headquartered in St. Louis (www.pottersignal.com).
CEO Bernie Lears and members of the Potter senior management team have retained a significant ownership position in the company and will continue to lead the business, managing all day-to-day operations. “We are excited to partner with Gryphon as we enter the next exciting stage of Potter’s evolution,” said Mr. Lears. “Potter has many opportunities to serve our existing customers even better and to expand our share in markets such as the fire alarm systems segment. We look forward to working with Gryphon to grow our business, and most importantly to deliver even more outstanding products and service to our customers in the coming years.”
“Our investment in Potter aligns very well with Gryphon’s focus on investing in companies with growth potential in the specialty electronics and light manufacturing and assembly sectors, and it takes advantage of Gryphon’s extensive prior experience in the fire safety segment,” said Bob Grady, Partner and Co-Head of the Industrial Growth Group at Gryphon. “We are excited to partner with Bernie Lears and his team and we look forward to working with them, and to supporting the company’s continued growth both organically and through acquisitions.”
Kelly Romano, the former president of several of United Technologies’ Fire and Security, and Carrier Corporation global businesses; Mark Levy, the former President and CEO of Honeywell Life Safety; and Rob Salek, the former CEO of Gryphon portfolio company Consolidated Fire Protection, will join the Board of Directors of Potter (along with Gryphon professionals Bob Grady, Wes Lucas and Felix Park) as part of Gryphon’s investment.
The fire safety industry in well-known to Gryphon. In December 2015 it acquired JENSEN HUGHES, a consulting firm specializing in fire protection engineering, fire code consulting, and related life safety services in commercial, institutional, and industrial facilities. In February 2005, Gryphon acquired Consolidated Fire Protection, a designer and installer of fire safety systems to commercial, industrial, and institutional customers, and sold the company in November 2007 to MX Mercury Beteiligungen GMBH, a fire and life safety company owned by European private equity firm Industrial Kapital.
Gryphon Investors makes leveraged acquisitions and growth investments in middle-market companies. The firm invests from $50 million to $200 million of capital in companies with sales ranging from $100 million to $500 million. Sectors of interest include business services, consumer and retail, automotive, chemical, general manufacturing, healthcare and hotels. Gryphon closed its fourth private equity buyout fund, Gryphon IV, in November 2016 at $1.1 billion, and raised a $100 million captive mezzanine fund, Gryphon Mezzanine Partners, in August 2017. Gryphon Investors is based in San Francisco (www.gryphoninvestors.com).
“Potter is another exciting example of Gryphon’s successful strategy of developing proprietary insights in specific attractive industry sectors and building expertise within these sectors,” said R. David Andrews, Gryphon’s Founder and CEO. “The company is our third investment in the fire safety industry, after Consolidated Fire Protection and JENSEN HUGHES. In addition to the significant positive macro trends benefiting the fire safety sector and Gryphon’s successful track record of investing in this sector, we are also very pleased to support Potter’s mission to help save lives.”
Stifel Nicolaus was the financial advisor to Gryphon and Harris Williams & Company was the financial advisor to Potter.
© 2017 Private Equity Professional | December 20, 2017