Palladium Closes Third Kymera Add-On

Kymera International, a maker of specialty materials used in the metallurgical, chemical and industrial processes industries and a portfolio company of Palladium Equity Partners, has acquired Reading Alloys from AMETEK for $250 million in cash.

Reading Alloys designs, develops and produces master alloys, thermal barrier coatings and titanium powders that are used in aerospace and aircraft applications. The company is known for its expertise in aluminothermic smelting, induction melting, and vacuum sintering capabilities. Reading was founded in 1953 and is headquartered just west of Reading in Robesonia, Pennsylvania.

AMETEK acquired Reading in 2008 from a management-led group and its lenders. During its nearly 12 years of ownership, Reading’s sales doubled from $80 million to more than $160 million in 2019.

Kymera is one of the largest manufacturers of specialty aluminum and copper powders worldwide. The company’s specialty materials are produced as powders, pastes, ingots and granules and include aluminum and aluminum alloys, copper and copper alloys, copper oxide, lead, magnesium, tin, and zinc in a range of shapes and particle sizes from coarse to ultrafine.

The operations of Kymera include ACuPowder International, ECKA Granules and SCM Metal Products. The company has manufacturing plants in seven countries across the US, Australia, Europe, and Asia. Kymera is led by CEO Barton White and is headquartered in Research Triangle Park, North Carolina.

“Reading Alloys is an outstanding company with highly skilled people and an excellent product and end-market portfolio that fits in perfectly with our existing business,” said Mr. White. “For Kymera, we believe this is a transformative acquisition that will give our combined company strong technical and commercial resources to help fuel our growth in the aerospace, defense, medical and industrial markets.”

Palladium acquired Kymera in October 2018. “The acquisition of Reading Alloys, Kymera’s third to date under Palladium’s ownership, is right on strategy as the Kymera management team continues to build the company into a leading specialty materials producer,” said Adam Shebitz, a partner at Palladium. “Kymera represents another great example of Palladium’s value creation framework, which pulls on both organic and M&A driven levers. We are excited about this opportunity to enhance the Kymera platform with Reading’s value-added products, growing end-markets and its talented employees.”

New York City-based Palladium invests from $50 million to $150 million of equity in companies that have $10 million to $75 million of EBITDA.  Sectors of interest include consumer, services, industrials and healthcare, and Palladium specializes in investing in companies that operate in the US Hispanic market.

In July 2019, Palladium held a final close of Palladium Equity Partners V LP with commitments of $1.56 billion. The firm’s earlier fund, Palladium Equity Partners IV LP, closed on $1.14 billion in 2014. Since its founding in 1997, Palladium has invested over $2 billion of capital in more than 35 platform investments and completed over 135 add-on acquisitions.

AMETEK (NYSE: AME), the seller of Reading Alloys, is a global manufacturer of electronic instruments and electromechanical devices with annual revenues of more than $4 billion. The company is headquartered in Berwyn, Pennsylvania.

© 2020 Private Equity Professional | March 26, 2020

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