Archives for November 7, 2018

KPS Building Billion Dollar Battery Giant

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C&D Technologies, a portfolio company of KPS Capital Partners since August 2017, has agreed to acquire Trojan Battery Company from Charlesbank Capital Partners. Charlesbank acquired Trojan in June 2013. The combination of C&D and Trojan will result in a company with more than $1 billion in annual revenue.

Trojan is a maker of deep-cycle batteries for motive and stationary applications such as golf and utility vehicles, renewable energy, transportation, floor machines, aerial work platforms, marine, and recreational vehicles. A deep-cycle battery is designed to be regularly deeply discharged using most of its capacity. In contrast, starter batteries (e.g. most automotive batteries) are designed to deliver short, high-current bursts for cranking the engine, thus frequently discharging only a small part of their capacity.

Trojan’s operations include four manufacturing plants in California and Georgia, two research and development centers, and international offices located in Europe, the United Arab Emirates and Asia. The company, led by CEO Neil Thomas, was founded in 1925 and is headquartered near Los Angeles in Santa Fe Springs, CA (www.trojanbattery.com).

C&D manufactures and services industrial lead-acid batteries and battery systems for the storage and transmission of electrical power, primarily for standby power applications. The company’s products and services are used in the utility, telecommunications, uninterruptible power supply, cable, broadband, and renewable energy markets.  C&D is headquartered near Philadelphia in Blue Bell, PA and has manufacturing facilities in Attica, IN (near Indianapolis); Milwaukee, WI; Reynosa, Mexico; and Shanghai, China. The company is led by its CEO Armand Lauzon and has approximately 1,400 employees (www.cdtechno.com).

“KPS acquired C&D to serve as a platform in the global energy storage industry, and the industrial logic of combining C&D and Trojan is extremely compelling,” said David Shapiro, a Managing Partner of KPS. “Trojan is an iconic brand name and we look forward to accelerating its growth by leveraging C&D’s global reach and strong technological capabilities.  We look forward to working closely with the management team and employees of C&D and Trojan to build the global leader in the energy storage industry.”

KPS Capital Partners is the manager of the KPS Special Situations Funds, a group of private equity funds with approximately $5.4 billion of assets under management that invests in restructurings, turnarounds and other special situations. KPS targets manufacturing and industrial companies that are going through a period of transition or experiencing operating or financial difficulties. The firm’s portfolio companies have aggregate annual revenues of approximately $5.5 billion, operate 110 manufacturing plants in 27 countries, and employ over 21,000 people worldwide. KPS Capital Partners is headquartered in New York (www.kpsfund.com).

Charlesbank invests from $50 million to $250 million in management-led buyouts and growth capital financings in companies with enterprise values of $150 million to $1.5 billion. Sectors of interest include consumer, industrial, industrial services and distribution, TMT and business services. In October 2017, the firm held a final closing of Charlesbank Equity Fund IX at its hard cap of $2.75 billion. The firm has offices in Boston and New York (www.charlesbank.com).

The closing of C&D’s buy of Trojan is expected to be completed by the end of 2018.

© 2018 Private Equity Professional | November 7, 2018

Palladin Begins Car Wash Consolidation

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Palladin Consumer Retail Partners has acquired Splash Car Wash in partnership with CEO Mark Curtis, co-founder Chris Fisher, and partner Dan Petrelle.

Splash Car Wash is a regional operator of car washes with 18 locations in New York and Connecticut. The company’s facilities offer full service, hand wash, express, and self-service alternatives, as well as oil and lube services at certain locations.

Splash, founded in 1981 by Mark Curtis and Chris Fisher, has more than 500 employees and is based in Greenwich, CT (www.splashcarwashes.com).

“The Palladin team brings a wealth of experience growing consumer brands,” said Mr. Curtis. “Being able to work with them marks a critical next step in our growth strategy. Their expertise, support and leadership will provide creative insights and operational improvements that will be instrumental in becoming a major regional and national platform.”

“We are excited to partner with Mark and the entire Splash team,” said Mark Schwartz, CEO of Palladin. “They have built an excellent company and are well-respected in the industry. We are confident that, with additional capital and resources, we can work together to significantly expand the Splash organization.

Palladin Consumer Retail Partners invests from $10 million to $50 million of equity in retail and consumer products companies that have revenues of $50 million to $500 million and EBITDA of $5 million to $20 million. The firm was founded in 1998 and is based in Boston (www.pcrp.com).

Splash washes more than one million cars per year and was recently ranked by Professional Carwashing & Detailing magazine as the 17th largest chain in the US (click HERE for the list).

“We have spent over a year researching the car wash industry and identified Splash as a leading regional carwash operator and the perfect anchor acquisition,” said Anders Petersen, Managing Director of Palladin. “The experience of the management team, familiarity managing different car wash models, and commitment to employees and customer service provide an excellent partnership for growth and development. We look forward to working with Mark and his team growing Splash both organically and through acquisitions.”

Goldman Sachs Specialty Lending Group provided debt financing for this transaction, as well as an unfunded acquisition line and revolving credit facility to support acquisitions and working capital needs.

© 2018 Private Equity Professional | November 7, 2018

Kinderhook Adds Again to RWB

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Race Winning Brands, a portfolio company of Kinderhook Industries, has acquired Giannone Performance Products, a manufacturer of high-performance aluminum connecting rods.

Giannone Performance Products (DBA MGP Connecting Rods) was founded in 1996 by the late Michael Giannone (he passed away in 2015) and is headquartered in Colorado Springs, CO (www.mgpconnectingrods.com).

“The company is set to reach full potential now as part of the Race Winning Brands family” said Darcell Giannone, owner and wife of founder Michael Giannone. “I am excited to see the brand continue to grow and prosper in alignment with Michael’s vision for MGP.”

Race Winning Brands (RWB) is a manufacturer of performance and racing pistons as well as connecting rods, crankshafts, electronics, and other engine related components. The company sells its products to the automotive and powersports performance markets under several brands including JE Pistons, Wiseco Performance Products, K1 Technologies, Diamond Pistons, Trend Performance, Dart Machinery, Rekluse Motor Sports, Falicon Racing and ProX Racing Parts. Customers include professional and sportsman racers, engine builders, enthusiasts, street performance racers, OEM crate engine builders, and automotive and powersports wholesale distributors. The company, led by CEO Brian Reese, is headquartered east of Cleveland in Mentor, OH (www.racewinningbrands.com).

“We continue pursuing our vision of leading racers to victory with the best engine parts in the market, MGP is further investment in our expansion to adjacent categories,” said Mr. Reese.

The buy of MGP is the fifth add-on acquisition for Race Winning Brands. In April 2017 the company acquired sister companies Diamond Pistons and Trend Performance, manufacturers of high-performance engine components; in April 2018 it acquired Rekluse, a maker of high-performance clutches for the powersports market; in August 2018 it acquired Dart Machinery, a maker of high-performance engine blocks, cylinder heads and intake manifolds; and in November 2018 it acquired Falicon Crankshafts, a maker of high-performance crankshafts, connecting rods, camshaft sprockets and racing clutches.

“The acquisition of MGP adds another premium automotive brand to Race Winning Brands’ stable of high-performance products. We are excited for the future of MGP in partnership with RWB,” said Paul Cifelli, a Managing Director of Kinderhook.

Kinderhook makes control investments in companies with transaction values of $25 million to $150 million in which the firm can achieve financial, operational and growth improvements. The firm makes investments in non-core divisions of public companies, management buyouts of entrepreneurial-owned businesses, troubled situations, and existing small capitalization companies lacking institutional support. Sectors of interest include healthcare services, environmental/business services, and automotive/light manufacturing. Kinderhook was founded in 2003 and is based in New York (www.kinderhook.com).

© 2018 Private Equity Professional | December 5, 2018

Wynnchurch Adds to Anderson Metals

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Wynnchurch Capital has acquired Midland Metal Mfg. and will combine the business with its existing portfolio company Anderson Metals which it acquired in January 2018.

Midland Metal is a distributor of fittings, valves, clamps, and other products to companies active in the general industrial, hose, fluid power, plumbing, oil and gas, agriculture, water, truck and trailer, and power transmission markets. The company has more than 13,000 SKUs and has 140,000 sq. ft. of facilities in Kansas City, MO (headquarters), Kerman, CA (near Fresno); Atlanta, GA; and Houston, TX (www.midlandmetal.com).

Midland Metal was founded in 1980 and is led by CEO Vince Hodes. Mr. Hodes is investing alongside Wynnchurch and will become CEO of the combined company. “We are honored to partner with Wynnchurch and combine two successful, family-owned businesses.  Wynnchurch has shown it’s committed to providing us with the resources necessary to better serve our customers and markets.  This is an exciting opportunity and a new chapter for both Midland and Anderson,” said Mr. Hodes.

“We are excited to partner with Vince and his team to build on Midland’s legacy as a market leader.  We share the same set of values Vince has instilled in the company’s culture and look forward to supporting the company’s growth plans,” said Greg Gleason, Managing Director at Wynnchurch.

Anderson Metals is a manufacturer and distributor of brass fittings, valves, pipe nipples, and other products that are used in the plumbing, hardware and general industrial end markets. The company supplies over 12,000 SKUs across a variety of categories including lead-free and leaded brass fittings, valves, pipe nipples, non-metallic fittings, and assorted parts and accessories. Last year, Anderson Metals processed more than 17,000 orders and has more than 27 million fittings in stock. The company was founded in 1947 and has an 84,000 sq. ft. distribution center and headquarters in Kansas City (www.andersonmetals.com).

“The combination of Midland and Anderson enhances our value proposition for customers with complementary products, new capabilities, and geographic reach,” said Chris O’Brien, Managing Partner at Wynnchurch. “We look forward to working with management to create a leading industrial distribution platform through organic growth initiatives and strategic acquisitions.”

Wynnchurch makes investments in middle-market companies that have revenues of $50 million to $1 billion. Sectors of interest include aerospace & defense, automotive, building products, chemicals, food, logistics, energy services & equipment, environmental services, industrial products & services, metals & mining, and paper & packaging. The firm was founded in 1999 and is located in the Chicago suburb of Rosemont with additional offices in Los Angeles (El Segundo), and Toronto (www.wynnchurch.com).

© 2018 Private Equity Professional | November 7, 2018