IOP Closes Third Fund III Platform

Industrial Opportunity Partners has acquired United Poly Systems, a manufacturer of made-to-order high-density polyethylene (HDPE) pipe.

United Poly Systems (UPS) produces pipe with diameters from ¾” to 4” IPS and 4″ to 16″ DIPS that are used for fluid and electrical transmission in the telecommunications, power utility, electrical and oil and gas sectors (iron pipe size (IPS) and ductile iron pipe size (DIPS) are legacy pipe sizing systems still in use by some industries).

The company, led by CEO Scott Franklin, was founded in 2011 by Jim Massengale and Bert Bridges. UPS is headquartered in Springfield, MO with an additional manufacturing facility in Albuquerque, NM (www.unitedpolysystems.com).

IOP is partnering in its investment with the company’s founders and other members of the senior management team, all of whom have ownership interests and will remain in their current positions. Norm Young, an IOP operating principal, will assume the position of chairman of the board of UPS. “We look forward to partnering with the UPS management team in continuing to serve the company’s customers with a focus on high levels of service and expanding UPS’ production capacity and product offering,” said Mr. Young.

UPS is the third platform investment for IOP’s third fund, Industrial Opportunity Partners III LP, which closed in July 2017 with $450 million of committed capital. The two earlier Fund III portfolio companies are Creative Foam, a Fenton, MI-based manufacturer of die cut, formed foam, nonwoven, and other components used in the automotive, medical, and wind energy markets; and SRR Holdings which owns SignResource, a Knoxville, TN-based designer and manufacturer of exterior and interior signage for retail fuel/convenience store chains; and Royston, a Jasper, GA-based designer, manufacturer and installer of check out and merchandising fixtures and equipment.

IOP focuses on acquiring middle-market manufacturing and value-added distribution businesses, typically with revenues between $30 million and $400 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 (www.iopfund.com).

“We are excited to partner with the UPS team. We believe that UPS has an excellent reputation with its customers and strong end-market demand drivers,” said Kyle Hood, a director of IOP.

Senior debt financing for this transaction was provided by TCW Asset Management with subordinated debt financing provided by Norwest Mezzanine Partners.

© 2019 Private Equity Professional | June 11, 2019

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