Archives for March 9, 2021

Advent Sees 15x on Latest Exit

by

DuPont has agreed to acquire the performance materials unit of Laird Technologies for $2.3 billion. The transaction is expected to close in the third quarter of 2021.

Advent International acquired Laird Technologies in July 2018 in a public-to-private transaction for just under $1.4 billion. Post-closing, Advent organized the business into four units – performance materials, connectivity, thermal management, and connected vehicles. This last unit was sold to Molex Electronic Technologies in December 2018.

Laird’s performance materials unit (LPM) manufactures microwave absorbers and electromagnetic enclosure and shielding systems – made from thermoplastics, elastomers, films and foams – that are used to protect sensitive electronic components in automotive, consumer electronics, datacenter, industrial, and medical applications.

According to DuPont, the purchase price for LPM of $2.3 billion equals a transaction multiple of approximately 15x estimated 2021 EBITDA excluding synergies and 11x including synergies (DuPont has forecasted synergies of $60 million). LPM revenues in 2020 were $465 million with a gross margin of approximately 50% and an adjusted EBITDA margin of approximately 30%. LPM has more than 4,300 employees and 11 manufacturing facilities in North America, Europe, and Asia.

“Laird’s performance materials unit is an outstanding business. Following a strategic refocus and investment in the company’s product offerings and talent, the business has achieved strong growth,” said Shonnel Malani, a managing director at Advent International. “We believe that DuPont will be an excellent partner for the performance materials unit and the combined organization will be ideally placed to provide customers with a unique and broad range of comprehensive and innovative solutions.”

“The acquisition of LPM is a significant step in advancing DuPont’s strategy to grow as a global innovation leader and premier multi-industrial company,” said Ed Breen, the CEO of DuPont. “LPM is a strategic and complementary addition to our electronics and industrial business, and our applied material science expertise together with LPM’s industry-leading application engineering capabilities further strengthens DuPont as an essential partner for major electronics OEMs and manufacturers.”

DuPont de Nemours (NYSE: DD), commonly known as DuPont, is a multinational chemical and specialty materials company with revenues of more than $20 billion. Dupont is headquartered in Wilmington, Delaware.

Advent International invests in companies active in business and financial services; healthcare; industrial; retail, consumer, and leisure; and technology, media and telecom. The firm has 15 offices in 12 countries and employs 195 investment professionals across North America, Europe, Latin America, and Asia. Founded in 1984 and headquartered in Boston, Advent has $66 billion in assets under management and has completed more than 350 private equity transactions.

Morgan Stanley & Co. and Rothschild & Co. are the financial advisors to Advent International and J.P. Morgan is the financial advisor to DuPont.

© 2021 Private Equity Professional | March 9, 2021

Dunes Point Keeps Busy, Enters Label Making Sector

by

Dunes Point Capital has formed Premium Label & Packaging Solutions to acquire Overnight Labels.

Overnight Labels is a maker of pressure-sensitive labels and shrink sleeves; flexible films for bags and pouches; instant redemption coupons; and peel-back labels. The company’s services include prototyping and pre-production sample production, digital printing for smaller product volumes as well as large volume production runs.

Overnight’s products – the company produces over 400 million printed units per year – are used in the nutraceutical, sports nutrition, beverage (beer, wine and spirits), health and beauty, and household products sectors.

Overnight Labels, founded in 1987, has approximately 70 employees and a 35,000 square foot facility on Long Island in Deer Park, New York.

Dunes Point is a family office and private investment firm that makes control investments in companies operating in the general industrial and business services sectors that have enterprise values of up to $1 billion.

Equity capital for the formation of Premium Label and the buy of Overnight Labels was provided by Dunes Point’s second fund, Dunes Point Capital Fund II LP. The transaction advisory group of Alvarez & Marsal was the financial advisor to Dunes Point on this transaction and Corporate Fuel Advisors was the financial advisor to Overnight Labels.

Dunes Point has been an active acquirer over the past few months. Last October, the firm formed Best in Class Technology Services (BCTS) as a commercial HVAC services platform to acquire Vulcan Heating and Air Conditioning Service, P1 Services and Rieck Services.

Together, these three companies have approximately 450 employees and provide commercial HVAC maintenance, repair and project work through 12 locations across six states. BCTS is headquartered in Birmingham, Alabama and is led by CEO Dan Shirey, the former president of Vulcan.

Dunes Point was founded in 2013 by Timothy White, a former senior managing director of credit-focused hedge fund GSO Capital which was acquired in 2008 by Blackstone and renamed Blackstone Credit in 2020.

© 2021 Private Equity Professional | March 9, 2021

Platinum Acquires Healthcare Products Distributor

by

Platinum Equity has acquired NDC, a distributor of consumable healthcare supplies, from Court Square Capital Partners. Court Square acquired NDC in February 2016 from Silver Oak Services Partners.

NDC is a distributor of branded and private label supplies to the healthcare industry with specializations in the medical, dental, physical therapy, long-term care, homecare and specialty markets.

NDC subsidiaries, divisions and brands include Preferred Medical, Wolf Medical, Main Street Vaccines, National Physician Care, MedPlus Services USA, NuEdge Alliance, Wolf-Pak, Quala Dental Products and Pro Advantage.

The company operates as a master distributor, purchasing medical supplies directly from manufacturers and providing a broad product line to local, regional, and national distributors who handle the last mile of delivery to health care providers. NDC has more than 685,000 square feet of warehouse space at its headquarters in Nashville (485,000 square feet) and at its satellite warehouses in Illinois (2), Florida (2), Arkansas, Kansas, California, Tennessee, Maryland and Texas. NDC stocks more than 90,000 SKUs with access to over 130,000 SKUs from more than 700 manufacturers. NDC president and CEO Mark Seitz, who has been with the company for 16 years, will continue to lead the business post-closing under Platinum Equity’s ownership.

“We are proud to have partnered with Mark Seitz and the NDC management team over the past five years to grow its diverse customer base, product lines and end markets,” said Jeff Abramoff, a partner at Court Square. “The success of this transaction is a result of the differentiated position NDC has in the healthcare supply chain and outstanding work from the NDC management team.”

“NDC has built an impressive national distribution platform with substantial opportunity for growth,” said Jason Price, a managing director at Platinum. “The company has strong leadership, a service-oriented culture and a unique value proposition that makes the delivery of medical supplies more efficient. Our plan is to continue building scale organically and through additional partnerships or M&A activity to grow the company’s footprint and expand its base of customers and suppliers.”

Platinum Equity invests in a range of industries including manufacturing, distribution, transportation and logistics, equipment rental, metals services, media and entertainment, technology, and telecommunications. The firm is currently investing from Platinum Equity Capital Partners V LP, a $10 billion buyout fund, and Platinum Equity Small Cap Fund LP, a $1.5 billion buyout fund focused on the lower middle market. The firm has completed more than 300 acquisitions since its founding in 1995 and is headquartered in Beverly Hills.

New York City-based Court Square, the seller of NDC, invests in middle-market companies that have enterprise values of $150 million to $1.5 billion. Sectors of interest include business services, general industrials, healthcare, and technology/telecommunications.

BMO Harris Bank provided financing to support the buy of NDC by Platinum Equity, and William Blair, Cantor Fitzgerald, and Robert W. Baird were the financial advisors to Court Square.

© 2021 Private Equity Professional | March 9, 2021

VMG’s Fifth Fund Hits Hard Cap in Three Months

by

VMG Partners has closed VMG Partners V LP (Fund V) at its target and hard cap of $850 million. The firm’s new fund was raised in just three months.

VMG invests in companies that are active in the food, beverage, wellness, pet products, personal care and household products sectors.  The firm was founded in 2005 and is headquartered in San Francisco.

VMG stands for “velocity made good”, a term used in sailing, especially in yacht racing, indicating the speed of a sailboat towards (or from) the direction of the wind. The term represents the ideal combination of speed and progress toward the destination to maximize the sailboat’s velocity.

“VMG was founded on our team’s mutual passion to build brands and support entrepreneurs,” said Mike Mauzé, a general partner of VMG. “In the past fifteen years VMG has brought their expertise to the CPG space and during that time we have developed strong relationships with our investors. These long-term limited partners have been great assets and strategic mentors in building the VMG franchise.”

Some of the firm’s past and present investments include Babyganics, Mighty Leaf Tea, Pirate’s Booty, Justin’s, Natural Balance, Waggin’ Train, Nature’s Bakery, and Pretzel Crisps (a complete list of VMG’s past and present investments by fund is available HERE). VMG has substantially exited all the portfolio companies from its first and second funds and has sold three of its portfolio companies from its third fund. With the closing of Fund V, VMG’s assets under management now total just over $2.6 billion.

“Our passion at VMG is to support the broader consumer ecosystem of entrepreneurs, retailers, and global CPG strategics regarding where the consumer is going versus where they’ve been historically,” said Wayne Wu, a general partner at VMG. “Through our genuine and consistent efforts to support the broader consumer ecosystem, we’ll have the opportunity to partner with best-in-class founders and teams to build leading brands.”

PJT Park Hill was VMG’s placement agent for this fundraise and a Latham & Watkins provide legal services.

© 2021 Private Equity Professional | March 9, 2021