Archives for August 9, 2022

Marilyn Yang Newest VP at Branford Castle

by

Branford Castle has promoted Marilyn Yang to Vice President.

At Branford Castle, Ms. Yang’s responsibilities encompass all aspects of deal origination through deal completion, including portfolio company oversight.

Before joining Branford Castle in 2018, Ms. Yang worked as an investment banking analyst in the industrials group at Barclays where her work focused on mergers and acquisitions and equity and debt financing transactions.

Ms. Yang is active with several of the firm’s portfolio companies including ABC, an Indiana-based manufacturer of flexible ventilation products and technical fabrics (August 2019); Sunless, an Ohio-based maker of spray tanning equipment and supplies (August 2019); Vitrek, a California-based maker of electrical safety test and measurement equipment (January 2018); and Earthlite, a California-based manufacturer of massage tables and other beauty and wellness equipment (July 2016).

Ms. Yang has her undergraduate degree in economics, with concentrations in finance, marketing and strategic management, from the Wharton School of the University of Pennsylvania.

Branford Castle invests in companies that have enterprise values of up to $100 million and EBITDA of less than $15 million. Sectors of interest include consumer products and services, commercial distribution, industrials and specialty manufacturing, business services, and logistics.

A recent acquisition by Branford Castle was the June buy of Handi Quilter, a Utah-based manufacturer and designer of quilting machines, from Premier Needle Arts, a portfolio company of Blue Point Capital. Handi Quilter sells both branded and private label longarm quilting machines. The company also produces quilting tables and frames as well as quilting accessories including replacement parts, scissors, rulers, templates and patterns.

For the past 15 years, New York City-based Branford Castle has been led by John S. Castle and David Castle. Included in the day-to-day management team of the firm is Managing Partner Laurence Lederer.

© 2022 Private Equity Professional | August 9, 2022

Bow River Beats Target on Third Fund

by

Bow River Capital has closed its third private equity fund, Bow River Private Equity Fund III LP (Fund III), with $590 million in capital. The firm’s newest fund was oversubscribed and exceeded its target of $500 million. Fund III was supported by both existing and new investors.

“We are pleased by our limited partners’ support of Fund III and are excited to work with such a highly respected group of investors,” said Greg Hiatrides, a managing director and head of Bow River’s private equity strategy. “Access to alternative asset investing is more readily available than ever and we are fortunate to have the trust of our limited partners.”

Bow River invests in the lower middle market across three asset classes, including private equity, real estate, and software growth equity. Within private equity, the firm makes control investments in companies that have revenues from $25 million to $200 million and EBITDA from $5 million to $20 million. Sectors of interest include industrial services, healthcare services, and business services.

In June 2022, Bow River’s private equity group acquired One10, a Minneapolis-headquartered provider of incentive and marketing services to enterprise, and small and medium-sized businesses.

“We see a significant opportunity as leading enterprises continue to recognize the need to invest in their employee and channel relationships. As we evaluated the industry, One10 stood out as an ideal platform company due to the strength of leadership and depth of One10’s professionals,” added Mr. Hiatrides.

Bow River was founded in 2003 and is headquartered in Denver.

Perkins Coie provided legal services to Bow River on this fundraise and no placement agent was used.

© 2022 Private Equity Professional | August 4, 2022

O2 Closes 4th Dental Lab Add-On

by

Frontier Dental Lab Group, a portfolio company of O2 Investment Partners, has acquired D&S Dental Laboratory.

D&S Dental is a provider of general dentistry and cosmetic dentistry products. The company has approximately 125 employees and is headquartered near Madison in Waunakee, Wisconsin, with four additional laboratories in Wisconsin (3) and Illinois.

[Source: Frontier Dental Lab Group]
Frontier Dental Lab (FDL) is a full-service, multi-site laboratory group that provides dental prosthetics for cosmetic dentistry (anterior crowns and bridges, and veneers), general dentistry (posterior crowns and bridges), implants, and other removable dental products (dentures and nightguards). FDL is headquartered near Sacramento in El Dorado Hills, California.

“D&S has a rich history of nearly 50 years of excellence, and we could not be more thrilled to add them to the platform,” said Jimmy Frye, a vice president at O2. “Alongside NuArt, the partnership with D&S further strengthens the platforms Midwest presence.”

O2 acquired FDL in July 2019 in partnership with the company’s owners and senior management team led by President Brent West and VP Sales Gil Villavecer. At acquisition, the company operated two dental laboratories, one each in California and British Columbia.

In addition to the buy of D&S, FDL has acquired three other dental labs including Wisconsin-based NuArt Dental (October 2019), California-based Burbank Dental Laboratory (March 2022), and New York-based Dental Lab Aesthetics (May 2022).

Today, with the close of the buy of D&S, FDL now has just over 605 employees and operates ten laboratories under five brands in California (2), Wisconsin (5), Illinois, New York, and  Canada.

O2 makes control investments in companies with EBITDA of more than $5 million located anywhere in the United States and Canada but with a preference for the Midwest and the Great Lakes regions. The firm’s typical transaction size is $15 million to $50 million. Industries of interest include manufacturing, niche distribution, select service and technology businesses. O2 is based in the Detroit suburb of Bloomfield Hills, Michigan.

© 2022 Private Equity Professional | August 9, 2022

J.F. Lehman, Apollo, and Hill City Team Up to Buy Atlas Air Worldwide

by

Publicly traded Atlas Air Worldwide has agreed to be acquired by an investor group that includes J.F. Lehman & Company, Apollo and Hill City Capital, in an all-cash transaction with an enterprise valuation of $5.2 billion.

Atlas Air Worldwide (AAW) is a provider of outsourced aircraft and aviation operating services. The company’s wholly owned subsidiaries include Atlas Air and Titan Aviation, and majority owned Polar Air Cargo Worldwide.

An Atlas Air Boeing 747-8F [Source: Atlas Air Worldwide]
The company’s fleet of Boeing 747, 777, 767, and 737 aircraft are used for domestic, regional, and international cargo and passenger operations. According to the company, it operates the world’s largest fleet of 747 freighter aircraft.

In FY 2021, AAW reported revenues of just over $4.0 billion, an adjusted EBITDA of $1.1 billion, and free cash flow of $434 million. Based on an enterprise value of $5.2 billion, this equates to a 4.7x EBITDA valuation multiple and a 12.0x free cash flow valuation multiple.

AAW is led by CEO John Dietrich and is headquartered 25 miles northeast of New York City in Purchase, New York. At the close of the transaction, AAW will continue to be led by Mr. Dietrich.

“Over our 30-year history, Atlas Air Worldwide has grown to become a global leader in airfreight, delivering high-quality services to our diverse roster of customers around the world,” said Mr. Dietrich. “Following the closing of the sale to the consortium, we will seek to leverage their resources, relationships and industry expertise to build on our strong financial and operational performance. Their investment in our company demonstrates their confidence in our people and our culture as we serve the growing needs of the global supply chain.”

“Atlas Air Worldwide is a market leader that continues to set higher standards for excellence within the airfreight industry,” said Apollo partners Antoine Munfakh and Jason Scheir, and J.F. Lehman partner Alex Harman in a released statement. “With the strong market demand and long-term secular tailwinds for global air cargo services, Atlas is poised to capitalize on many opportunities for continued growth as a portfolio company of Apollo, J.F. Lehman, and Hill City. We look forward to leveraging our resources, capital and experience in the sector to support the talented Atlas team, alongside our partners in this exciting next phase.”

J.F. Lehman is a middle-market private equity firm focused primarily on the maritime, defense and aerospace sectors. The firm was founded in 1992 by Dr. John Lehman, who served six years as Secretary of the United States Navy. J.F. Lehman is headquartered in New York City with an additional office in Washington, DC.

New York City-headquartered Apollo (NYSE: APO) has more than $513 billion of assets under management and more than $83 billion dedicated to private equity. The firm has acquired more than 350 companies since its founding in 1990.

Hill City Capital is an investor in industrial, aerospace and transportation companies. The firm was founded in 2019 by Herbert Frazier and is headquartered in Boston.

Committed financing to support the buy of AAW is being provided by Goldman Sachs, Barclays, Apollo Capital Management, Mizuho, and Credit Agricole. Morgan Stanley is the financial advisor to AAW.

The transaction is expected to close during the fourth quarter of 2022 or the first quarter of 2023.

© 2022 Private Equity Professional | August 9, 2022