Gryphon Adds Again to Shermco

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

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