Archives for September 11, 2019

All Star and Atlantic Street Partner Up

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Atlantic Street Capital has acquired All Star Auto Lights, a distributor of alternative lighting products.

All Star’s products include recycled and refurbished OEM parts and certified aftermarket products, including headlamps, tail lamps, park lamps, fog lamps and turn signals for both foreign and domestic vehicles. All Star’s restoration services are done in-house and range from basic lens clean-up to complete light rebuilds.

All Star has an inventory of over 40,000 lights and sells its products to independent auto body shops, multi-site operators of collision repair centers, and individuals. Used and refurbished lights account for about 80% of the company’s revenues with the remaining 20% from a combination of OEM product and aftermarket lights. The company was founded in 2004 by Mark Immerfall and is led by CEO Matt Immerfall (son of the founder).

All Star is headquartered in Orlando with nationwide distribution through seven facilities in Florida, Michigan, Tennessee, Texas, California, North Carolina and Pennsylvania (www.allstarautolights.com).

Atlantic Street is partnering on this transaction with Matt Immerfall and other investors. “We recognized the need for a strategic partner to help All Star grow by investing in and supporting the company’s organic growth plan and executing on acquisition opportunities.   We believe Atlantic Street has the right team of professionals to help us achieve our aggressive growth goals,” said Mr. Immerfall.

“The US auto collision repair market is a growing category and a variety of factors are causing consumers, insurance carriers, and auto collision repair shops to help mitigate increasing costs with high-quality alternatives,” said Peter Shabecoff, managing partner of Atlantic Street. “Both recycled or refurbished OEM parts and aftermarket parts are now viable, cost-effective alternatives to new parts and All Star is a leader in terms of differentiated price, quality, available inventory, timely delivery, and service.  We look forward to partnering with Matt as we expand and grow its operations.”

“We are very excited about this investment because of All Star’s leading industry position and its ability to serve as a cost-effective and quality alternative to higher-priced new OEM products,” said Phil Druce, a partner at Atlantic Street. “Working with Matt, we will capitalize on opportunities to expand the company’s footprint, further penetrate existing customers, and evaluate potential expansion into new product categories.”

Earlier this month, Atlantic Street held a final closing of Atlantic Street Capital IV LP at its hard cap with $500 million of capital commitments. The firm’s earlier fund closed in October 2016 with $210 million of committed capital.

Atlantic Street invests from $15 million to $40 million in middle-market companies with EBITDA from $4 million to $15 million. The firm invests across a range of sectors but has a specific interest in healthcare, multi-unit retail, business services, and consumer products and services. Atlantic Street was founded in September 2006 by Peter Shabecoff and is based in Stamford, CT with an additional office in West Palm Beach, FL.

© 2019 Private Equity Professional | September 11, 2019

Sentinel Exits Luminaires

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Sentinel Capital Partners has agreed to sell The Luminaires Group, a manufacturer of architectural lighting fixtures, to Acuity Brands. Luminaires was acquired by Sentinel through its fifth fund in June 2016.

The Luminaires Group designs, develops, manufactures, and distributes specification-grade lighting products that are used in both interior and exterior applications in commercial, institutional, hospitality, and urban applications. The company operates through five product divisions including a-light (indoor architectural lighting); Cyclone (outdoor decorative products for the municipal market); Eureka (indoor and outdoor contemporary decorative lighting); Luminaire LED (indoor and outdoor vandal-resistant lighting); and Luminis (indoor and outdoor products for commercial and institutional applications).

Luminaires has annual sales of approximately $100 million and 350 employees across five locations in the US and Canada. The company, led by President Christian Fabi, was founded in 1987 and is headquartered in Quebec (www.luminairesgroup.com).

“Luminaires’ management team, under the leadership of Christian Fabi, built a world-class business with an incredible culture and a deep commitment to serving its customers with innovative lighting solutions,” said Marc Buan, a principal at Sentinel. “During our partnership, Luminaires has successfully completed a complex consolidation of three separate divisions and has integrated two add-on acquisitions, which enabled the company to centralize management, streamline operations, and expand its product offerings. We are thrilled to have worked with this team and see a very bright future for Luminaires as part of Acuity Brands.”

The two add-on acquisitions completed by Luminaires were the November 2018 buy of Luminaire LED, a New Jersey-based manufacturer of indoor and outdoor vandal-resistant lighting; and the December 2016 buy of Luminis, a Montreal-based manufacturer of indoor and outdoor lighting products for commercial and institutional applications.

Sentinel Capital Partners invests in management buyouts, recapitalizations, corporate divestitures, and going-private transactions of businesses with EBITDAs up to $65 million. Sentinel targets eight industry sectors: aerospace and defense, business services, consumer, distribution, food and restaurants, franchising, healthcare, and industrials. The firm is headquartered in New York (www.sentinelpartners.com).

Acuity Brands (NYSE: AYI) is a lighting manufacturer and building-management services provider with more than 12,000 employees and annual revenues of approximately $3.7 billion. Acuity’s products include luminaires, lighting controls, building system controllers, prismatic skylights, power supplies and integrated systems for indoor and outdoor applications in commercial, industrial, institutional, infrastructure and residential spaces. The company is headquartered in Atlanta and has operations throughout North America, Europe and Asia (www.acuitybrands.com).

© 2019 Private Equity Professional | September 11, 2019

Arcline Buys Akron Biotechnology

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Arcline Investment Management has acquired a majority interest in Akron Biotechnology.

Akron manufactures and distributes materials that are used for cell and gene therapy research, development, and commercialization. The company’s products include cytokines (proteins that promote cell signaling) and growth factors, cryopreservation solutions, and cell culture media supplements (used to support the growth of cells).

Akron was founded in 2006 by Claudia Zylberberg, PhD, the company’s chief executive officer. Akron’s first proprietary product was CryoSolve, a single-use syringe filled with cryopreservation media used to preserve stem cells. CryoSolve continues to be one of Akron’s most successful products and is used by stem cell banks around the world. Akron is headquartered in Boca Raton, FL (www.akronbiotech.com).

In partnership with Arcline, Akron will continue to be led by Dr. Zylberberg and she will also be a member of the company’s board of directors. “We recognize that the cell and gene therapy industry has reached a critical juncture. With so many therapy developers progressing through advanced stages of clinical development, the demand for cGMP-grade materials will increase dramatically in the near future. We are delighted to partner with Arcline to substantially expand Akron’s capacity to meet this growing demand for the benefit of the entire regenerative medicine industry and the patients it serves,” said Dr. Zylberberg.

Arcline plans to organically expand Akron’s capabilities and pursue add-on acquisitions within the cell and gene therapy manufacturing tools, ancillary materials and services sectors.

Arcline makes control investments in companies that have from $10 million to $100 million of EBITDA and enterprise values of up to $1 billion. Sectors of interest include industrials, technology, life sciences, and specialty chemicals. The firm closed its first fund, Arcline Capital Partners LP, with $1.5 billion of committed capital in March 2019. Arcline was founded in September 2018 and has offices in San Francisco and New York (www.arcline.com).

Dark Horse Consulting Group, a San Jose-based consultant specializing in cell and gene therapy product development, provided advice and assistance to Arcline in connection with the buy of Akron. Arcline formed a strategic partnership with Dark Horse in July 2019.

© 2019 Private Equity Professional | September 11, 2019

Gryphon Adds Again to Shermco

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Shermco Industries, a portfolio company of Gryphon Investors, has acquired NextGen Technologies.

NextGen is an electrical testing services provider that designs, builds, tests, maintains, and repairs electrical infrastructure across a range of applications with a specialty in communications protection and control (CPC) systems. The company, led by President Chris Soles, is headquartered in North Vancouver, BC (www.nextgen-tech.ca).

Gryphon acquired Shermco in June 2018 from Oaktree Capital Management. Shermco provides testing, maintenance, repair, commissioning, and repair 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 equipment within facilities.

Customers of Shermco are active in the commercial, industrial, municipal, and utility sectors. The company, founded in 1974 and led by CEO Bill Mohl, has approximately 500 employees with 28 locations and is headquartered near Dallas in Irving, TX (www.shermco.com).

“NextGen’s broad capabilities and highly technical workforce will be an excellent addition to the Shermco portfolio and serve as a platform to allow us to expand our protection and control services across North America,” said Mr. Mohl. “We anticipate continuing our acquisition strategy to expand our presence in new markets and broaden our service offerings.”

The buy of NextGen is the third add-on acquisition closed by Shermco under Gryphon’s ownership. In August, Shermco acquired two companies: Electrical Manufacturing and Distributors, a Wichita Falls, TX-based provider of control systems design, fabrication, integration, and programming services to the midstream oil and gas sector; and Southwest Energy Systems, a Phoenix, AZ-based provider of third-party electrical testing and engineering services to the utilities, technology, industrial, and government sectors.

Gryphon makes leveraged acquisitions and growth investments in middle-market companies. The firm invests from $100 million to $300 million of capital in companies with EBITDA of up to $50 million. Sectors of interest include business services, consumer products and services, healthcare, industrial growth, and software. In July 2019 the firm held a final closing of Gryphon Partners V LP at its hard cap of $2.1 billion. The new fund was oversubscribed and exceeded its original target of $1.5 billion. Gryphon is based in San Francisco (www.gryphoninvestors.com).

© 2019 Private Equity Professional | September 11, 2019