Susquehanna Buys McNally

Susquehanna Private Capital has acquired McNally Industries from Gardner Standard.

McNally designs, reverse engineers and manufactures military-grade pumps, gun components and other products for defense, energy and other industrial applications. The company’s services also include design engineering, testing and assembly, and after-market support.

McNally was founded in 1942 as the McNally Brothers Machine Company by James, Donald and Miles McNally to provide spare parts (including mechanical fuses) to the military during the second world war. Today, McNally’s products and services support many defense programs such as ground combat vehicles, including Bradley, Paladin and the Army’s new Armored Multi-Purpose Vehicle (AMPV); Army rotary-wing aircraft including Blackhawk, Apache and Chinook; the Navy’s fleet of DDG-51 destroyers as well as the Army’s 120mm, 81mm and 60mm mortar weapons systems. McNally is led by President Jim Segelstrom and is headquartered 100 miles south of Duluth in Grantsburg, WI (www.mcnally-industries.com).

Gardner Standard acquired McNally in July 2016. Under its ownership, the company nearly doubled in size and the firm invested in new automated manufacturing technology and expanded the company’s sales and engineering teams. “Gardner Standard has been a terrific partner for McNally by supporting our growth plans with capital for new equipment purchases and providing strategic guidance,” said Mr. Segelstrom. “This support has allowed me, together with the rest of the McNally management team, to focus on growing the business and delivering significant value to our customers.”

“McNally provides a compelling value proposition to its customers and is well-positioned for future success,” said Michael Healy, the managing member of Gardner Standard. “During our ownership period, Gardner Standard and McNally’s management team made significant capital investments in manufacturing equipment and a new 17,500 square foot assembly and test facility, which have enabled McNally to win new programs and deepen customer relationships.  Going forward, we are excited to continue our involvement and work with Susquehanna Private Capital as a minority equity investor.”

Gardner Standard makes control and influential minority equity investments in North American-based companies that have from $7.5 million to $75 million in revenue. Sectors of interest include manufacturing, aerospace & defense, industrial services and engineered industrial products. The firm is based in New York.

Susquehanna Private Capital (SPC) makes control investments of $10 million to $75 million in companies that have EBITDA from $3 million to $30 million. Sectors of interest include aerospace, industrials, consumer, healthcare, and business and government services. SPC was founded in 2017 by Susquehanna International Group (SIG), a privately held investment, trading and technology firm with approximately 2,000 employees. SIG is headquartered in the Philadelphia suburb of Bala Cynwyd with additional offices in New York, Chicago, San Francisco, Philadelphia, Boston, Sydney, Dublin, Shanghai, Beijing and Hong Kong.

© 2019 Private Equity Professional | September 9, 2019

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