Archives for April 12, 2018

CVF Closes Third Fund

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CVF Capital Partners has held a final closing of its latest mezzanine fund, The Central Valley Fund III (SBIC) LP, with $200 million of committed capital.

The new fund will provide junior capital (subordinated debt and preferred equity) of $3 million to $15 million to companies with at least $10 million in revenue and $2 million of cash flow. Sectors of interest include business and government services, industrial manufacturing, aerospace, telecom, healthcare, distribution and logistics, and food and beverage. CVF prefers to invest in companies headquartered in the Western US, with a particular focus on California and its Central Valley region.

“We appreciate this vote of confidence from our investors, many of whom have been with us since our founding,” said Brad Triebsch, Managing Partner and Co-founder of CVF Capital Partners. “We look forward to investing this capital in promising companies while continuing our consistent track record of strong investment returns for our limited partners and their constituents. We have a healthy pipeline of opportunities and will put this additional capital to work by continuing to partner with management teams, private equity sponsors, commercial banks, and other deal professionals.”

CVF Capital Partners has offices in Davis, CA (headquarters); Fresno, CA; San Diego, CA; and Portland, OR (www.centralvalleyfund.com).

“We have a successful track record as patient, long-term investors committed to working closely with sponsors and company management teams to create stable capital structures and optimal investment outcomes for all parties,” said Ed McNulty, a CVF Managing Partner. “We look forward to continuing this legacy throughout CVF III.”

CVF’s earlier fund closed in June 2012 with $100 million of total committed capital.

© 2018 Private Equity Professional | April 12, 2018

One Equity Acquires ePak Resources

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One Equity Partners (OEP) has completed its acquisition of ePak Resources, a designer and manufacturer of packaging for semiconductors, integrated circuits and other electronic components. The management team of ePak will continue to own a significant stake in the company in partnership with OEP.

ePak products include boxes, canisters, containers, trays and other products that are used for the storage and transport of electronic products used by semiconductor companies, system OEMs, and integrated circuit assembly and test operations.

The company has a 600,000 square foot manufacturing facility and design center in Shenzhen, China which is centrally located to the semiconductor industry’s back-end activities and supports a global network of just-in-time distribution centers. ePak also maintains 40 warehouses and nine sales offices worldwide and has just over 1,100 employees. The company was founded in 1999 and is headquartered in Austin, TX (www.epak.com).

“ePak’s high-quality products have enabled it to become a primary supplier to more than 300 businesses that rely on its advanced packing materials for their complete handling needs during the front end semiconductor fabrication process, and safe transport of integrated circuit products at the back end,” said Andrew Oliver, Managing Director, OEP. “We are excited to have identified several acquisition opportunities with CEO Steve Dezso and his management team to further strengthen the company’s product portfolio, geographic footprint and customer base.”

According to OEP, ePak’s target customer sector continues to grow with annual silicon wafer shipments increasing for the fourth year in a row through 2017 as semiconductor demand from original equipment manufacturers, automotive and consumer electronic businesses remained strong. Worldwide wafer shipments increased by 10 percent in 2017 over 2016, while worldwide sales of silicon grew by 21 percent to $8.7 billion over $7.2 billion in 2016.

“OEP’s long track record of partnering with management teams to improve operating efficiencies and drive growth through strategic transactions is well aligned with our vision for growing ePak into an unparalleled market leader in the innovative packing solutions market,” said Steve Dezso, President and CEO of ePak. “Today is an exciting milestone in ePak’s continued evolution, and we look forward to working closer with OEP to further consolidate the fragmented packaging market and gaining additional share as the company enters its next stage of growth.”

One Equity Partners is a middle-market private equity firm that invests in industrial, healthcare, and technology companies that are based in North America and Europe. Since 2001, the firm has invested in more than 150 transactions worldwide. One Equity, founded in 2001, spun out of JP Morgan in 2015. The firm has offices in New York and Chicago, and an advisory office in Frankfurt, Germany (www.oneequity.com).

© 2018 Private Equity Professional | April 12, 2018

JMH Exits Industrial Rental Services

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JMH Capital has sold the assets of its portfolio company Industrial Rental Services to publicly-traded United Rentals (NYSE: URI).

In 2008, JMH formed Industrial Rental Services to acquire Service Radio Rentals (SRR) and Industrial Blind Solutions (IBS).  Industrial Rental Services is headquartered in Houston with additional sales and service offices in major petroleum and oil refining centers.

SRR was founded in 1997 and rents two-way radio communications equipment (radios, repeaters and related accessories) to industrial maintenance providers serving the US oil refinery, petrochemical, pulp & paper, and power generation industries.  The company is the largest independent radio rental company serving this market (www.serviceradio.com).

IBS was founded in 2005 to provide both sale and rental of isolation and hydrotest blinds to the US oil refinery industry. Isolation and hydrotest blinds are used in the oil and gas and other industries to isolate a section of pipe, sealing it off so that nothing can flow through, allowing work and inspection crews to perform needed tasks. IBS also provides racking systems that are used to both deliver and store blinds on site (www.industrialblindsolutions.com).

The buy of SRR and IBS expands United Rentals’ specialty tool rental fleet by over 35,000 isolation blinds, flanges and racking systems for industrial applications, as well as approximately 16,000 radios, repeaters and accessories for plant maintenance and construction personnel.

United Rentals is the largest equipment rental company in the world with locations in 49 states and every Canadian province. The company is headquartered in Stamford, CT (www.unitedrentals.com).

JMH Capital makes control investments of up to $25 million to acquire companies that have from $5 million to $150 million of revenue. Sectors of interest include niche manufacturing, specialty chemicals, building products, medical devices, business services, value-added distribution, analytical instruments, food products, and business services. The firm is headquartered in Boston (www.jmhcapital.com).

BlackArch Partners (www.blackarchpartners.com) was the financial advisor to JMH Capital and Industrial Rental Services.

© 2018 Private Equity Professional | April 12, 2018

Canopy and Plexus Exit Freight Force

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Freight Force, a portfolio company of Canopy Capital Partners and co-investor Plexus Capital, has been sold to St. George Logistics, a portfolio company of Wind Point Partners.

Freight Force specializes in first mile and last mile transportation services and operates the nation’s largest network of independent carriers serving freight forwarders and other third-party logistics (3PL) providers. The company has partnerships with local and regional motor carriers in 52 metropolitan areas and can provide its services across the entire United States.

Freight Force serves more than 2,200 freight forwarders and 3PL providers and executes approximately 500,000 first and last mile deliveries annually. The company was founded in 1982 and is headquartered in Anaheim, CA (www.freightforce.com).

St. George Logistics (STG) is a provider of container freight station (CFS) services for ocean and air cargo imported into the United States. The company also provides logistics services, including contract warehousing, distribution, e-commerce fulfillment and transportation services. The STG customer base includes freight forwarders, neutral NVOCCs (non-vessel operating common carriers), retailers, consumer packaged goods companies, and other businesses. The company is headquartered near Newark in South Kearny, NJ with additional facilities located in the nation’s largest ports and metropolitan areas, including Los Angeles, Houston, Chicago, Atlanta, Savannah and Charleston (www.stgusa.com).

“We were extremely fortunate to partner with incoming CEO Chris Coppersmith and the rest of the Freight Force management team in the acquisition of Freight Force back in January 2015,” said Scott Long, Canopy Capital Managing Partner. “Since their founding in 1983, Freight Force has offered a compelling value proposition for both its freight forwarder customers as well as their network of approved motor carriers. During our term of ownership, we were able to add key employees as well as new customer and carrier relationships which helped drive substantial growth in revenue and EBITDA.”

Canopy Capital invests in companies that have revenues from $5 million to $100 million and EBITDA from $2 million to $10 million. Sectors of interest include business services, transportation and logistics, niche manufacturing, and value-added distribution. The firm invests across the US but places an emphasis on the southeastern states particularly Florida. Canopy Capital was founded in 2015 and is headquartered in Tampa (www.canopycp.com).

“We were excited when Canopy Capital and Chris Coppersmith initially approached Plexus with an opportunity to work together on this transaction,” said Alex Bean, a Partner with Plexus Capital. “Both Canopy Capital and Chris Coppersmith, as well as the entire Freight Force team, helped deliver exceptional growth and a positive outcome for the Freight Force employees, management team, and investors.”

Plexus Capital invests up to $40 million of subordinated debt and equity in companies that have revenues of up to $150 million and EBITDA of up to $20 million. The firm invests across all industries. Since its founding in 2005, Plexus has raised $950 million of capital across four funds and invested in 88 companies. Plexus has offices in Charlotte and Raleigh, NC (www.plexuscap.com).

Raymond James Financial was the financial advisor to Freight Force.

© 2018 Private Equity Professional | April 12, 2018