May River Forms New Platform, Buys Kason

May River Capital has completed its acquisition of Kason Corporation, a maker of processing equipment, from Baird Capital which acquired the company in October 2013. To complete the buy of Kason, May River formed Advanced Material Processing (AMP), a new platform company that will combine Kason with May River’s existing portfolio company, Marion Process Solutions.

Kason manufactures equipment used to separate materials from solids and slurries including circular vibratory screeners and centrifugal screeners. The company also makes a line of fluid-bed processors that are used for the drying, cooling, or moisturizing of bulk solids.

Kason’s products are used in a range of industries including food, pharmaceutical, chemical, plastic, energy, minerals, aerospace and defense. The company, led by CEO Henry Alamzad, was founded in 1967 and is headquartered in Milburn, NJ with additional offices in Canada and the UK.

Marion manufactures food, chemical, plastic, and mineral mixers and blenders, as well as microwave vacuum drying systems that are used in the food, nutraceutical, mineral, plastic, chemical, and biomass industries. The company, led by CEO Lee Eilers, was founded in 1938 and is headquartered in Marion, IA.

“Great things happen when you align industry leaders, and the combination of Kason and Marion brings a new level of competitive advantage to our customers,” said Mr. Eilers. “These are certainly exciting times as AMP continues to expand its product and service offering to serve a market that expects excellence as the benchmark.”

“AMP is an exciting new platform for May River,” said Chip Grace, a partner at May River. “Material processing equipment is a highly fragmented sector. Combining industry-leading, complementary material processing equipment manufacturers will allow us to advance engineering capabilities, in addition to providing other synergies. Our goal is to create short- and long-term value by providing better products and services to our customers.”

Brad Sterner, the CEO of Hunt Valve, a portfolio company of May River since January 2016, and the executive chairman of Industrial Flow Solutions, also a May River portfolio company, has been named as the executive chairman of AMP. “I’m especially excited to work with the Kason and Marion teams and their channel partners to build a global platform with a focus on organic and acquisitive growth in the hygienic process end markets,” said Mr. Sterner.

May River invests from $15 million to $40 million of equity in companies with enterprise values of $15 million to $75 million. Sectors of interest include precision manufacturing, engineered products, specialized industrial services, and value-added industrial distribution. May River was founded in February 2012 and closed its inaugural fund, May River Fund I LP, in March 2017 with total commitments of $170 million. The firm is based in Chicago.

Baird Capital, the seller of Kason, invests in companies that have up to $150 million in revenue and are active in the healthcare, industrial products and services, and technology sectors. The firm was founded in 1989 and is based in Chicago.

Abacus Finance Group and Northstar Capital provided debt financing in support of this transaction.

Hennepin Partners was the financial advisor to both Kason Corporation and Baird Capital.

© 2019 Private Equity Professional | September 4, 2019

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