L Catterton has entered into an agreement to acquire Airxcel, a designer and producer of heating, ventilating, air conditioning and appliance products, from One Rock Capital Partners.
Airxcel’s products are used in both OEM and aftermarket applications in the recreational vehicle, marine, commercial and industrial markets. Company-owned brands include Coleman-Mach, MaxxAir, Suburban, Dicor, Vixen Composites, United Shade, MCD, Marvair, Industrial Climate Engineering and Eubank. The company was founded in 1991 and is headquartered in Wichita, KS (www.airxcel.com).
“L Catterton has an exemplary track record of building leading brands and a strong understanding of our industry, which makes them the ideal partner for Airxcel,” said Jeff Rutherford, President and CEO of Airxcel. “We have invested significantly in innovation over the last five years and Airxcel is poised to further build on its category leading positions and portfolio of trusted brands to meet the evolving needs of tomorrow’s customer.”
According to L Catterton the recreational vehicle (RV) equipment category has experienced steady growth over the past 30 years and the outlook remains strong. The $18 billion RV supplier market has shown extraordinary growth, especially over the past five years, growing at 12% per year. Wholesale shipments were up 17% in 2017 to an all-time high of 505,000 units. While historically demand for RVs has been driven by baby boomers, millennials have emerged as a core demand segment as they adopt RVs for new uses, including tailgating, kayaking and attending festivals. Millennials now comprise nearly 40% of all new buyers of RVs and more than 6 million have expressed interest in buying RVs.
“In Airxcel, we saw a proven and attractive platform for sustained success both inside and outside the RV industry and through both organic and acquisition growth avenues. As an essential partner to OEMs and aftermarket distributors, Airxcel will take advantage of the exciting secular trends in the RV industry and the significantly growing purchase interest from millennials, which will fuel growth for years to come,” said Marc Magliacano, Managing Partner of L Catterton.
L Catterton invests from $50 million to $400 million of capital in consumer-focused companies. Areas of specific interest include food and beverage, retail and restaurants, consumer products and services, consumer health, and media and marketing services. L Catterton was founded in 1989 and has raised over $14 billion of equity capital across six funds. L Catterton has 17 offices globally and is headquartered in Greenwich, CT (www.lcatterton.com).
One Rock acquired Airxcel in November 2014 from Bruckmann, Sherrill, Rosser & Company. “Since our acquisition in 2014, Airxcel has nearly doubled earnings through strong organic growth, internal operational improvements and the acquisition and integration of three highly complementary businesses,” said One Rock Managing Partner Tony Lee. “The business is well-positioned to continue on that trajectory under the leadership of CEO Jeff Rutherford and his management team.” The three add-on acquisitions completed by One Rock were the March 2017 buy of Cordele, GA-based Eubank, a manufacturer of wall mount packaged air conditioners and heat pumps; the September 2016 buy of Elkhart, IN-based Dicor Products, a supplier of roofing products and other component products to RV manufacturers; and also in September 2016 it acquired McKinney, TX-based MCD Innovations, a manufacturer of RV window shades.
“During One Rock’s ownership Airxcel reduced working capital by half, implemented lean manufacturing practices throughout its production footprint and successfully integrated three acquisitions while building an active pipeline of future opportunities,” said One Rock Managing Partner Scott Spielvogel. “One Rock’s operating partners and the management team have worked closely together to build a market leading supplier of industry-leading branded products with the execution discipline to continue to build upon its success to date.”
One Rock invests in companies that are active in the chemicals and process industries; specialty manufacturing and healthcare products; business and environmental services; and food manufacturing and distribution. One Rock has a strategic relationship with Mitsubishi Corporation which provides resources to One Rock and its portfolio companies. The firm was formed in 2010 by Tony Lee and Scott Spielvogel and is based in New York (www.onerockcapital.com).
Debt financing for this acquisition will be provided by Jefferies, Morgan Stanley and Citizens Capital Markets.
Jefferies and Robert W. Baird & Co. were the financial advisors to Airxcel and One Rock on this transaction.
© 2018 Private Equity Professional | March 15, 2018
Industrial Opportunity Partners has acquired Royston, a maker of retail store fixtures, from Stephens Capital Partners which acquired the company in August 2007.
“We are excited to partner with the Royston team. We believe that Royston is a differentiated business with longstanding customer relationships and an excellent reputation,” said Kyle Hood, a Director of IOP.
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 is headquartered in the Chicago suburb of Evanston (
Stephens Capital Partners, the seller of Royston, makes equity investments in profitable, cash-flow-producing businesses with above-average margins that have valuations of $50 million to $200 million. The firm is part of Stephens Inc., a Little Rock, AR-based privately held, independent financial services firm and one of the largest privately owned investment banks in the country (
Sun Capital Partners has sold its portfolio company Demilec, one of North America’s largest manufacturers of spray foam insulation, to Huntsman Corporation. Sun Capital acquired Demilec in October 2013.
“This bolt-on acquisition is a great fit to our core strategy to move downstream,” said Peter Huntsman, Chairman, President and CEO of Huntsman. “The integration of Demilec into our existing polyurethanes business offers significant synergies and delivers substantially higher and very stable margins by pulling through large amounts of upstream polymeric MDI into specialized spray foam systems. This integrated business will have greater than 25% EBITDA margins and double-digit growth.”
Sun Capital invests in leveraged buyouts, equity, and debt in companies that can benefit from its in-house operating professionals and experience. Sun Capital has invested in and managed more than 340 companies worldwide with combined sales in excess of $45 billion since the firm’s inception in 1995. The firm has offices in Boca Raton, Los Angeles and New York, and affiliates in London, Frankfurt, Stockholm and Shenzhen (
Huntsman (NYSE: HUN) is a manufacturer and marketer of a range of chemical products with 2017 revenues of approximately $8 billion. The company has more than 75 manufacturing, R&D and operations facilities in 30 countries and employs more than 10,000. Huntsman is headquartered in The Woodlands, TX (north of Houston) and has executive offices in Salt Lake City, UT (
Prior to joining Periscope, Mr. Friedman was a vice president at Chicago-based Ardenton Capital, a lower middle market private equity firm, where he focused on both deal origination and fundraising. Previously, he was a vice president at Gibraltar Business Capital, where he focused on sponsor-backed, private credit origination. Earlier in his career, Mr. Friedman was an assistant vice president at PNC Capital Markets in its financial services, advisory and banking practice. He has a BBA in Finance from the University of Wisconsin.
