Monroe Backs CORE’s Build of “Industry 4.0”

Monroe Capital provided financing for last month’s buy of GPI Prototype & Manufacturing by Midwest Composite Technologies (MCT), a portfolio company of CORE Industrial Partners.

Monroe is an active provider of senior and junior debt financing to middle-market businesses, special situation borrowers and private equity sponsors. Investment types include unitranche financings; cash flow, asset-based and enterprise value based loans; and equity co-investments. The firm is a frequent provider of debt to CORE for its industrial acquisitions, and it provided an increase to an existing debt facility which was used to finance CORE’s original buy of Wisconsin-based MCT in September 2018.

CORE has been actively assembling a 3D prototyping and low-volume production services platform since acquiring MCT. The company’s technical capabilities include laser sintering, poly-jet printing, stereolithography, multi-jet fusion technologies, CNC machining, and injection molding. Customers of MCT are active in the medical, aerospace, research & development, consumer, and industrial end markets.

Companies like MCT are part of “Industry 4.0” which refers to the current trend of automation and data exchange in manufacturing technologies. The goal of Industry 4.0 is the creation of “smart factories” that utilize cyber-physical systems, the Internet of things, cloud computing and cognitive computing. Industry 4.0 is commonly referred to as the fourth industrial revolution.

In December 2019, MCT acquired ICOMold, an Ohio-based custom plastic injection molder and a provider of CNC machining services. A second add-on was closed by MCT in September 2019 with the buy of FATHOM, a California-based manufacturer with an expertise in 3D printing and additive manufacturing.

GPI Prototype & Manufacturing, MCT’s latest add-on, uses direct metal laser sintering (DMLS) – a process that employs a high powered laser to melt and fuse metallic powders together – to print parts with complex geometries for on-demand manufacturing applications. The company has capabilities with a range of metal powders, including aluminum, steel and stainless steel, titanium, Inconel (a nickel-chromium-based alloy) and cobalt chrome.

Customers of GPI include numerous Fortune 500 companies operating in the medical, aerospace and defense sectors. The company, led by President Adam Galloway, was founded in 2007 and is headquartered north of Chicago in Lake Bluff, Illinois.

With MCT’s buy of GPI, CORE has placed all four of its Industry 4.0 companies – MCT, ICOMold, FATHOM and GPI – under the FATHOM brand. The combined company now has 100 large-platform industrial-grade 3D printing machines and a national footprint with over 200,000 square feet of manufacturing capacity across five facilities.

Monroe Capital (NASDAQ: MRCC) was founded in 2004 and is headquartered in Chicago with additional offices in Atlanta, Boston, Los Angeles, New York, and San Francisco.

Chicago-based CORE makes control investments in companies that have revenues of up to $200 million, EBITDA of up to $20 million, and enterprise values up to $150 million.

Private Equity Professional | September 3, 2020

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