Archives for February 23, 2021

MPE Begins Power Repair Platform

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MPE Partners has acquired MSHS Group, a provider of MRO services to the marine and power generation sectors.

MSHS Group operates through two business units; MSHS(Motor-Services Hugo Stamp), which specializes in reciprocating engine services and repairs for the maritime and stationary power industries. MSHS has offices in Florida, Louisiana, Maine, Virginia, and the Bahamas; and GCS (Governor Control Systems), which specializes in control systems integration, automation, monitoring and repairs across a range of industries. GCS has offices in Florida, Louisiana, Virginia, and Washington.

MSHS Group was founded in 1983 and is headquartered in Fort Lauderdale.

“Since its founding over 35 years ago, MSHS Group has developed a reputation for superior quality, technical expertise, and unmatched customer service, and has grown into a leading service provider in the industry,” said Matt Yohe, a partner at MPE.

MPE partnered on this transaction with MSHS majority owner Are Friesecke and its CEO David Santamaria.

“We look forward to partnering with Are, David, and the rest of the MSHS Group team to build upon the company’s sterling industry reputation and to accelerate its growth initiatives while maintaining the strong culture and commitment to its customers that has made MSHS Group so successful to date,” said Michael Duffy, a vice president at MPE.

MPE invests in lower middle-market companies that are valued from $25 million to $150 million and have EBITDAs between $5 million and $20 million. Sectors of interest include high-value manufacturing, and commercial and industrial services. The firm has offices in Cleveland and Boston.

Cross Keys Capital was the financial advisor to MSHS Group on this transaction.

© 2021 Private Equity Professional | February 23, 2021

Southfield Builds ARC

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American Refrigeration Company, a portfolio company of Southfield Capital, has acquired Capitol Engineering, a provider of HVAC services.

Capitol Engineering’s services include system design, installation, monitoring, maintenance and repair. The company serves commercial and industrial customers throughout New England.

Capitol Engineering was founded in 1937 by Clarence Chaisson and acquired by long-time employee John Frugard in 2009. The company is headquartered near Boston in Newton, Massachusetts.

Southfield acquired American Refrigerator Company (ARC), the largest independent industrial refrigeration service company in New England, in November 2017. ARC’s services include refrigeration and air conditioning system design, construction, equipment installation, and maintenance and repair services. The company’s customers are active in the food and beverage, cold storage, recreation, life sciences, pharmaceutical, and process industries.

“We have been working to find opportunities to grow the HVAC service offering at ARC,” said Chris Grambling, a principal at Southfield. “The buy of Capitol provides an exciting expansion of ARC’s HVAC capabilities in New England, enabling ARC to expand its client base and provide additional HVAC services to existing ARC customers.”

Other services provided by ARC include alternative refrigerant evaluations, freezing and cooling response assessments, energy studies, and compliance consultation. ARC, led by President Bill Fleming, was founded in 1996 and is headquartered north of Boston in Andover, Massachusetts (www.arc.cool).

“We’re delighted to welcome Capitol Engineering to the ARC family,” said Mr. Fleming. “Adding Capitol Engineering’s leadership, engineering depth, and experience to our existing team will undoubtedly enhance the HVAC service and maintenance solutions we currently provide to the region.”

Southfield Capital makes control investments in companies that are active in the outsourced business services sector and have EBITDA of $4 million to $12 million. The firm was founded in 2005 and is headquartered in Greenwich, Connecticut.

© 2021 Private Equity Professional | February 23, 2021

Wind Point Closes its Largest Fund

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Wind Point Partners has held a hard-cap close of the firm’s ninth fund, Wind Point Partners IX LP, with approximately $1.5 billion in capital commitments. This is the largest fund ever raised by Wind Point.

Limited partner commitments to the new fund totaled $1.4 billion and includes capital from institutional investors – public and corporate pension plans, insurance companies, family offices, and endowments and foundations – in North America, Europe, and Australia.

“We are incredibly thankful for the support we received from a high-quality group of existing and new investors in Fund IX,” said Nathan Brown, a managing director at Wind Point.

Wind Point’s investment team is led by six managing directors with an average tenure at Wind Point of 17 years. Since the raising of Wind Point’s eighth fund in July 2017 with $985 million of capital commitments, the firm has added five investment professionals at the vice president level, a chief talent officer, and a head of investor relations.

“The success of this fundraise is a testament to the strength and depth of our team, which we have continued to invest behind to support Wind Point’s growth,” added Mr. Brown. “Our leadership team has worked together for nearly two decades and we have never been more excited about the firm’s culture and strong positioning.”

Chicago-based Wind Point invests from $50 million to $100 million in companies with EBITDA of at least $10 million. Industries of interest include business services, consumer products and industrial products. The firm utilizes a team of executive advisors (EAP), largely former CEOs of public and private companies, to advise and assist with strategy and value-creation at its portfolio companies. Wind Point’s EAPs committed more than $23 million of capital to Fund IX, and they will also make direct investments in the businesses in which they are involved alongside Wind Point.

“We have always believed that executive talent and leadership play a disproportionate role in the success of an enterprise,” said Alex Washington, a managing director at Wind Point. “Through our EAP network, we have C-suite access to 76% of S&P 500 companies within our targeted sectors, providing a tremendous advantage for the middle market companies with which we partner.”

“Our team is extremely excited about the opportunity to continue deploying Fund IX,” said Paul Peterson, a managing director at Wind Point. “We’ve committed approximately 40% of the fund so far and continue to see an attractive set of opportunities to execute our proven strategy of driving fundamental business transformation in well-positioned middle-market businesses through leadership enhancement.”

In October 2020, Wind Point acquired Handgards, a manufacturer of disposable products used in the foodservice sector including more than 200 types of gloves, bags, protective apparel and flexible packaging. The company has more than 300 employees and a 250,000 square foot facility and headquarters in El Paso, Texas. Wind Point partnered with industry executive Joe Kubicek – the former president of surgical glove maker Ansell – on this transaction. One month earlier, in September 2020, Wind Point acquired RTIC, a Houston-based direct-to-consumer (D2C) e-commerce seller of coolers, tumblers, bottles, and travel bags used by outdoor enthusiasts. Wind Point partnered with the RTIC’s founders and Bill Pond, who joined RTIC as its CEO. Mr. Pond is an experienced digital D2C executive and he is the former president of SwimOutlet.com (owned by Spiraledge). Earlier in his career, he spent 16-years leading the e-commerce business of L.L. Bean.

“The management teams across our portfolio have done a phenomenal job navigating a challenging environment over the last year. As a result, our portfolio has remained quite resilient, which was clearly valued by investors evaluating Fund IX,” concluded Mr. Peterson.

With the closing of Fund IX, Wind Point’s assets under management now total approximately $3.3 billion.

© 2021 Private Equity Professional | February 23, 2021

Praesidian Names New Partner

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Praesidian Capital has added a new partner to its investment team with the promotion of Tom Duffy.

At Praesidian, Mr. Duffy has been active sourcing new investments, conducting due diligence, structuring and executing transactions, and portfolio management.

“Tom has made significant contributions to Praesidian’s success since joining the firm in 2012,” said Jason Drattell, the founder and managing partner at Praesidian. “It has been a pleasure to see Tom progress in his career and we are excited to appoint him as a partner as we continue to build out Praesidian’s private equity business.”

Mr. Duffy joined Praesidian as an associate in August 2012 and was promoted to managing director in February 2019. Prior to joining Praesidian, he was with Bank of America Merrill Lynch and Morgan Stanley.

Praesidian was founded in 2002 and has been an active provider of senior and subordinated debt along with growth capital to lower middle-market businesses in the United States, United Kingdom, Germany, and selectively in Northern Europe.

Last month, Praesidian acquired a controlling interest in Round 2, a South Bend, Indiana-based hobby products company that designs and produces model kits, diecast models, and slot cars. Round 2 sells its products through major retailers including Walmart, Target, and Hobby Lobby and through its e-commerce platform at www.autoworldstore.com.

The buy of Round 2 is the second platform company acquired by Praesidian under its new strategy to make control investments in lower-middle market businesses that have enterprise values from $1 million to $100 million. Typical investments will have revenues of $3 million to $100 million and EBITDA of $250,000 to $20 million.

Praesidian Capital is headquartered in Larchmont, New York.

© 2021 Private Equity Professional | February 23, 2021