Archives for January 18, 2018

Windjammer Exits Big on Sale of JWC

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Windjammer Capital Investors has sold JWC Environmental to Sulzer Ltd. at an enterprise value of $215 million.

JWC Environmental is a provider of solids reduction and removal products such as grinders, screens, and dissolved air flotation systems that are used by municipal, industrial and commercial wastewater processors. JWC has a growing and recurring aftermarket business that provides parts and services to a large installed base built up over the last 45 years. The company was founded in 1973 and is headquartered near Los Angeles in Santa Ana, CA (www.jwce.com).

JWC is best known for its legendary Muffin Monster sewage grinder. Over 25,000 Muffin Monsters are installed globally to grind up the solid debris that ends up in wastewater pump stations, pipelines and sludge lines. The dual-shafted grinder protects pumps and downstream systems from clogging and potential damage.

Windjammer acquired JWC from its founding family in August 2011 through its $575 million third fund. During its ownership term, Windjammer added senior managers to JWC’s leadership team and supported the company’s expansion into industrial products, increased product development expenditures, completed two add-on acquisitions, and made investments to improve the company’s supply chain and operating efficiency.  Over the ownership term, JWC’s employment grew from 185 to approximately 230.

The two add-on acquisitions completed by JWC were the November 2015 buy of IPEC Consultants, a manufacturer of solids/liquid separation products for wastewater and specialty industrial process liquids; and the January 2017 buy of FRC Systems International, a maker of dissolved air flotation systems used in a variety of wastewater applications in the food and beverage, meat and poultry processing, and oil and gas industries.

“JWC’s market leadership position in a stable municipal market was attractive at the time of our initial investment, and served as a solid base to grow the company across geographies, product offerings, and end market applications,” said Jeff Miehe, Managing Director at Windjammer. “Windjammer helped JWC significantly transform during the past six years, and the company is well positioned to continue on its growth trajectory with the support of Sulzer.”

Sulzer is an industrial engineering and manufacturing firm headquartered near Zurich in Winterthur, Switzerland. The company has more than 15,000 employees and had annual revenues of approximately $3 billion in 2017 (www.sulzer.com).

The sale of JWC at an enterprise value of $215 million is equal to approximately 10x JWC’s 2018 forecasted EBITDA. The buy of JWC allows Sulzer to grow its wastewater treatment revenues through the addition of complementary equipment as well as to improve its access to the municipal and industrial wastewater market in North America. In addition, Sulzer will support JWC’s geographic expansion into markets in Europe, the Middle East and Africa (EMEA) and Asia. JWC will operate as part of Sulzer’s Pumps Equipment division and will continue to be headquartered in Santa Ana.

Windjammer makes control investments of $50 million to $200 million in middle market businesses with EBITDAs from $10 million to $50 million. Sectors of interest include niche manufacturing, value-added distribution and business services.  Windjammer is currently investing from its $726 million Windjammer Senior Equity Fund IV, which closed in March of 2013.  The firm was founded in 1990 and is based in Newport Beach, CA and Waltham, MA (www.windjammercapital.com).

“Windjammer provided valuable support and resources to assist JWC as we executed on our long-term strategic plan to transform the company and better serve both new and existing customers. Windjammer thinks and acts like both operators and investors, and encouraged and supported our strategic investments,” said Ken Biele, CEO of JWC.

© 2018 Private Equity Professional | January 18, 2018

Amzak Adds-On to AOC MetalWorks

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AOC MetalWorks, a portfolio company of Amzak Capital Management, has acquired StampTech, a metal fabrication and stamping company.

AOC MetalWorks is a full-service engineering and manufacturing company of custom metal fabricated parts and stamping. AOC specializes in the design, development, testing, program management, and production of custom industrial packaging and material handling, and stamping of light and heavy aluminum, stainless steel, and steel parts. The company, led by its president Thomas Collins, is headquartered southwest of Nashville in Lawrenceburg, TN (www.aocmetalworks.com).

StampTech is headquartered in Chester, VA (south of Richmond) and has three locations in Virginia and one in Georgia with an additional warehouse facility in Oklahoma. The combination of AOC and StampTech forms a metal stamping and fabrication operating platform with five manufacturing facilities across the southeastern US with annual revenues in excess of $80 million.

“This announcement marks the next significant milestone for both companies,” said Joe Vidmar, an Operating Partner at Amzak and interim CEO of the newly combined company. “Amzak is committed to driving growth at both companies through continued capital investment and additional resources. This commitment will not only drive bottom-line growth but will also provide our employees with more opportunities as we further develop the organization and strive to improve our operational excellence.”

Amzak Capital Management is a private investment firm owned by the Kazma family. The firm makes control and non-control equity investments of $10 million to $50 million in companies with $40 million to $200 million in sales and $4 million to $25 million in EBITDA. Amzak also invests in fixed income securities and real estate. The firm, led by Gerry Kazma and Michael Kazma, is headquartered in Boca Raton, FL (www.amzak.com).

The buy of StampTech is Amzak’s second investment in the metal stamping and fabrication industry and the firm is actively searching for additional investments within the space.

“The combination of AOC and StampTech provides us with the opportunity to diversify our revenue and provide a better overall product to our customers. With this addition, there is little we cannot do from a metal manufacturing standpoint and few areas we cannot reach within the Southeast,” said Alan Pettigrew, a StampTech shareholder and Vice President of New Customer Sales.

Fifth Third Bank provided the debt financing for this transaction and Dominion Partners (www.dominionpartners.com) was StampTech’s sell-side advisor.

© 2018 Private Equity Professional | January 18, 2018

Saw Mill Buys MeTEOR from Hudson Ferry

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Saw Mill Capital Partners has acquired MeTEOR Education from Hudson Ferry Capital. The acquisition of MeTEOR as made through Saw Mill’s second fund, Saw Mill Capital Partners II LP, which had a final close in July 2017 with $340 million in capital commitments. The buy of MeTEOR is the fourth investment made by this fund.

MeTEOR is a provider of classroom, technology and administrative furniture to the educational and institutional markets. The company’s services include design, consulting, project management, and installation to public and private schools in the K-12 market. The company specializes in larger projects where a school district is undergoing a major expansion or modernization program. MeTEOR currently serves more than 30 state markets across the country and is headquartered in Gainesville, FL (www.meteoreducation.com).

MeTEOR uses research-driven learning environment design, build, and implementation services to create physical settings—complete with modern seating options, desks and advanced technology—that are integrated with best practices teaching methods. This combination, according to the company, allows for greater student learning experiences that result in measurable increases in basic literacy, collaborative learning, and complexity of student tasks at all grade levels.

“We see MeTEOR Education as a truly unique and attractive partner in transforming the education landscape,” said Scott Rivard, a Partner at Saw Mill Capital. “We value the strong culture, differentiated offerings and solid growth strategy the company’s leadership team has built and look forward to partnering with MeTEOR as we serve the growing demand for high-impact learning environments.”

Saw Mill Capital invests in North American-based manufacturing, industrial and commercial service, and specialty distribution businesses with $25 million to $200 million of revenues and $5 million to $25 million of EBITDA. The firm was founded in 1997 and is headquartered north of New York City in Briarcliff Manor, NY (www.sawmillcapital.com).

Hudson Ferry first invested in MeTEOR Education in March 2010. “We are exceptionally pleased with our investment in MeTEOR. The company more than tripled in size, broadened its product offering and improved gross margins during the seven years of Hudson Ferry Capital’s investment. We worked with the management team to improve vendor relationships, clarify financial reporting, develop key success metrics, and finance growth. We are delighted that the MeTEOR sale has generated a 3x multiple of invested capital,” said Bruce Robertson, a Partner of Hudson Ferry Capital.

Hudson Ferry invests in lower middle market companies with enterprise values of $15 million to $75 million, revenues of $15 million to $75 million, and EBITDAs of $3 million to $8 million. Sectors of interest include niche manufacturers; business services providers; and outsourcing providers. Hudson Ferry was founded in 2007 and is based in Rye Brook, NY (www.hudsonferry.com).

“Hudson Ferry was an incredible partner as MeTEOR has grown and impacted students across the country. They brought so much more than capital to the table – their experience, support, and focus were instrumental in our growth and the full development of our products and services with High Impact Learning Environments and Experiences. Their involvement has helped us transform traditional schools into vibrant future-ready communities of learning for students around the entire country,” said Bill Latham, CEO of MeTEOR.

Signal Hill (www.signalhill.com), a Daiwa Securities Group company, was MeTEOR’s financial advisor for this transaction.

© 2018 Private Equity Professional | January 18, 2018

HC Private Investments Buys Kruger Plastic Products

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Kruger Plastic Products, a family-owned, custom injection molding manufacturer of niche products and components, has been acquired by HC Private Investments (HCPI).

Kruger’s services include design and engineering, raw material selection, processing, assembly and packaging.  The company has 47 injection molding machines ranging in size from 25 tons to 1,000 tons, and has a full-service mold making and repair department with CAD/CAM capabilities.

Kruger’s customers are active in a number of industries including homecare, furniture, electronics, hardware, healthcare, automotive, art and hobby, and communications. Kruger was founded in 1975 and is based in the southwestern Michigan city of Bridgman and has approximately 100 employees (www.krugerplasticproducts.com).

Kruger’s senior management team, including Pat Brandstatter, President, and Dirk Kruger, VP of Engineering, will maintain significant stakes in the company.  “We are excited to be working with HCPI to build long-term value,” said Mr. Brandstatter. “We believe that HCPI’s experience and capabilities make them the ideal partner for Kruger to take advantage of the significant opportunities ahead while maintaining our core values of quality and service.”

HCPI makes investments between $5 million and $30 million in lower-middle market manufacturing companies ranging in size from $10 million to $100 million in enterprise value. Sectors of interest include consumer and industrial. HCPI’s investments can take the form of control equity, growth equity, structured equity and junior debt. HCPI was formed in June 2017 by HC Technologies, a Chicago-based financial trading firm, and is led by its managing partners John Kelly and Matthew Moran. Mr. Kelly was previously a Vice President with The Tokarz Group Advisers and Mr. Moran was a Vice President at Wind Point Partners. HCPI is headquartered in Chicago (www.hcprivateinvest.com).

“Kruger Plastic Products has distinguished itself through an unwavering focus on quality and service to its many great customers and we are excited to partner with Pat and Dirk to help them expand the business,” said Mr. Kelly. “We have great respect for the team and business that has been built over of the course of four decades.”

HCPI has identified numerous opportunities to grow Kruger’s sales through both investments in manufacturing and personnel, and by expanding into new end markets such as medical products. “We could not be more delighted to build on the legacy of Kruger Plastic Products, and look forward to working with the team to build a growth platform and bring Kruger’s world-class products and services to a broader array of customers,” said Mr. Moran.

BlueWater Partners, an investment bank based in Grand Rapids, MI (www.bluewaterpartners.com), was the financial advisor to Kruger.

© 2018 Private Equity Professional | January 18, 2018