After a four-year hold, PNC Riverarch has sold specialty paint and coatings distributor Painters Supply and Equipment to Odyssey Investment Partners.
Painters Supply and Equipment (PSE) is one of the leading paint, body and equipment (PBE) distributors servicing more than 8,000 customers that operate in the collision, commercial, industrial, architectural and aerospace industries. The company’s products include interior and exterior paints; alkyds, acrylics, epoxies, and urethanes; powder coatings; exterior deck and siding stains; painting tools and supplies; concrete, garage and basement floor coatings; adhesives and sealants; and spray equipment.
PSE is a platinum-level distributor for paints and coatings giant PPG and is the company’s largest single-line distributor in North America. PSE, led by CEO Patrick Mayette, was founded in 1952 and is headquartered near Detroit in Taylor, Michigan with 380 employees, 3 master warehouses, and over 50 locations throughout Michigan, Georgia, Illinois, Indiana, Maryland, Missouri, Ohio, Pennsylvania and Virginia.
“PSE is a highly compelling investment opportunity with an outstanding business model that delivers recurring revenue as well as superior value to both vendor partners and customers,” said Jason Cowett, a managing principal at Odyssey. “The company’s supply chain expertise across diverse industries, commitment to customer service, and successful M&A strategy have enabled significant scale and market share gains.”
“Jason and the Odyssey team are the ideal partners for us to fuel our long-term strategic growth plans,” said Mr. Mayette. “We have built the industry-leading PSE brand over many decades through our unwavering commitment to being the premier distributor of high-quality auto refinish and industrial coatings. More recently, we have been executing a highly focused plan to strengthen our competitive advantages and build out our national platform.”
“PSE is well-positioned for accelerated growth through geographic and category expansion as well as continued consolidation of fragmented markets,” added Mr. Cowett. “We are excited to support CEO Patrick Mayette and the existing leadership team, who will continue to lead the company through its next phase of growth.”
New York and Los Angeles-based Odyssey invests in middle-market industrial and business services companies with $20 million to $100 million in EBITDA. The firm is investing out of its sixth fund, Odyssey Investment Partners Fund VI LP, which closed in February 2020 at its hard cap of $3.25 billion.
According to a source familiar with this transaction, MidCap Financial was the syndication agent, joint lead arranger and joint bookrunner on a senior secured credit facility to back the acquisition of PSE by Odyssey. The MidCap transaction team was led by Managing Director Grace Wang. MidCap, in alliance with its investment manager Apollo Capital Management, is a middle-market focused finance firm that provides debt instruments of $10 million to $750 million to companies across all industries.
Pittsburgh-based PNC Riverarch, the seller of PSE, invests from $10 million to $50 million in privately-held companies headquartered throughout North America. Sectors of interest include outsourced services, specialized manufacturing, and value-added distribution. PNC Riverarch is a division of PNC Capital Finance, which in turn is a subsidiary of PNC Financial Services Group (NYSE: PNC).
© 2021 Private Equity Professional | August 24, 2021
