Gryphon Investors has acquired Shermco Industries from Oaktree Capital Management.
Shermco provides testing, maintenance, repair, commissioning, engineering, and training services for electrical infrastructure including substations, switchgear, transformers, motors, and generators. Shermco services the entire electrical line – from high-voltage substations down to the distribution and drives equipment within facilities.
Customers of the company are active in the commercial, industrial, municipal, and utility sectors. Shermco, founded in 1974, has approximately 500 employees with 20 locations and is headquartered near Dallas in Irving, TX (www.shermco.com).
CEO Ron Widup and other members of Shermco’s management team have retained an ownership position in the company and will continue to lead Shermco under Gryphon ownership. “We are excited to partner with Gryphon as we continue to execute our shared growth initiatives through geographic expansion, servicing national accounts, and continuing our acquisition strategies,” said Mr. Widup. “We believe that Gryphon brings significant resources and relevant sector expertise to support these efforts.”
Gryphon has previously invested in the engineering services and industrial services sectors. In December 2015 it acquired JENSEN HUGHES, a Baltimore-based provider of fire protection engineering services; HEPACO, a Charlotte-based provider of planned and emergency environmental services, was acquired in August 2016; and Trinity Consultants, a Dallas-based provider of air quality compliance services, was purchased in November 2011 and exited in September 2015 (sold to Levine Leichtman Capital Partners).
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 LP, in November 2016 at $1.1 billion, and raised a $100 million captive mezzanine fund, Gryphon Mezzanine Partners LP, in August 2017. Gryphon Investors is based in San Francisco (www.gryphoninvestors.com).
“Shermco fits squarely within Gryphon’s strategy of acquiring growing, differentiated market leaders in industries with attractive long-term fundamentals,” said Alex Earls, Partner and head of the Business Services Group at Gryphon. “Ron and his management team have built a first-class business and we are excited to partner with them to support the company’s continued growth both organically and through acquisitions.”
KeyBanc Capital Markets was the lead financial advisor to Gryphon and Harris Williams & Company was the exclusive financial advisor to Shermco. Kirkland & Ellis was the legal advisor to Shermco.
© 2018 Private Equity Professional | June 5, 2018
