MiddleGround Pursues Power and Transmission Investments

MiddleGround Capital has acquired Attala Steel, a manufacturer and distributor of steel foundation components that are used for ground-mounted utility-scale solar photovoltaic installations.

Attala’s manufacturing capabilities include milling, fabrication and galvanizing and its products include galvanized I-beam posts, mounting rack supports, galvanized H-pilings (structural beams that are dimensionally square) and driven pier structures.

The company is headquartered north of Jackson in Kosciusko, Mississippi (little known fact – Kosciusko is the birthplace of Oprah Winfrey) with an additional facility south of Dallas in Hillsboro, Texas.

“Attala has done an excellent job establishing itself as a market leader by offering a best-in-class product, quality and service to its well-established customers across the solar market,” said Lauren Mulholland, a partner at MiddleGround. “As solar installations continue to grow, driven by attractive economics and both state and corporate renewable targets, Attala is well-positioned to provide steel foundation products to support the expansion, upgrades and modernization of utility-backed infrastructure installations. We look forward to supporting the company through its next phase of growth.”

The buy of Attala is MiddleGround’s eight platform for its first fund, MiddleGround Capital I LP, which had a final close in September 2019 with $459 million of capital, and is the firm’s second investment in a company serving the power and transmission industry.

In January 2020, MiddleGround acquired EDSCO Fasteners from LFM Capital. EDSCO is a manufacturer and distributor of foundation anchoring systems for power transmission poles and substation structures. The company’s anchoring systems – which range from specialty fabricated bolts to highly-engineered anchoring cages – are typically embedded in concrete foundations and are engineered to allow structures to be securely placed on top of the foundations. EDSCO is headquartered in Denton, Texas with additional facilities in Spanish Fork, Utah; McKenzie, Tennessee; Waterloo, Indiana; and Harrisburg, North Carolina.

“Over time, we expect to integrate Attala and EDSCO into one company supplying the needs for steel foundational products for power generation, transmission and distribution markets,” said Scot Duncan, a partner at MiddleGround. “Both EDSCO and Attala have strong management teams in place that will continue managing the businesses under a common capital structure. A few months ago, we hired Kevin Heskett to be the CEO for EDSCO and expect Kevin will be the CEO for the combined business.”

“We are excited with the opportunity to invest in the power generation and transmission space,” said John Stewart, a partner at MiddleGround. “Through our research, we have developed a specific thesis to make investments in companies that supply industrial products to mission-critical infrastructure projects. The United States power generation and distribution infrastructure is aged and in critical need of investment for repairs and upgrades. In addition, new green technologies are now gaining momentum and the race to generate clean power, supported by federal, state and local governments, is an exciting area to invest.”

MiddleGround makes control equity investments from $25 million to $65 million in North American-based business-to-business companies in the industrial and specialty distribution sectors that have enterprise values of up to $200 million. The firm was formed in May of 2018 by former Monomoy Capital professionals John Stewart, Lauren Mulholland and Scot Duncan.

© 2021 Private Equity Professional | January 12, 2021

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