Kaho Partners has formed Addtronics as a new holding company to acquire and grow robotic automation companies.
According to Kaho, the United States could have over two million unfilled manufacturing jobs by 2030, and Kaho formed Addtronics to strengthen the domestic manufacturing sector by increasing the implementation of robotic automation systems.
In tandem with the formation, Addtronics has made its first acquisition with the buy of Dynamic Design Solutions (DDS), a designer and fabricator of custom robotic automation systems. DDS customers are active in the automotive, aerospace and defense, energy, industrial, medical and life sciences, consumer goods, and packaging sectors. Charlotte, North Carolina-based DDS was founded in 1997 by Brad and Stacey DeMarco. Mr. DeMarco is retaining an equity ownership position in the business in partnership with Kaho and Addtronics.
“I am excited to partner with Addtronics for the next stage of DDS’ growth,” said Mr. DeMarco. “I was drawn to their mission-driven culture and their focus on improving the competitiveness of the American manufacturing sector. We know that our team and our customers will benefit from being part of a scaled organization that can provide additional resources, capital, and industry expertise.”
“We are thrilled to launch Addtronics after spending more than a year developing our thesis around robotic automation,” said Max Katzenstein, a managing partner of Kaho. “Addtronics is uniquely organized in a way that allows the companies we partner with to maintain their autonomy, brand identity, and culture, while also strengthening their competitive advantages through increased access to capital, resources, and scale. We look forward to partnering with additional robotic automation companies over the coming years as we transform this critical industry.”
In addition to acquiring DDS, Kaho has announced that Jerry Osborn and Adam Coffey have joined the board of Addtronics and that Mr. Osborn will lead the business as its president. Mr. Osborn is an experienced robotics automation executive with past senior positions at ABB and KUKA, two of the world’s largest industrial robot OEMs.
Mr. Coffey is an experienced buy-and-build executive that has spent more than 20 years as the CEO of multiple private equity-backed industrial services companies including as CEO of CoolSys, a provider of refrigeration and HVAC services, from 2016 to 2021. CoolSys was owned by Audax beginning in 2016 and was sold to Ares Management in 2021; CEO of WASH Multifamily Laundry Systems, a provider of route-based laundry services, from 2003 to 2016. CHS Capital and New Harbor Capital acquired WASH in 2008 and sold the business to EQT in 2015; and president of Masterplan, a California-based provider of medical device repair and maintenance services, from 2001 to 2003.
“The COVID-19 pandemic showcased how dependent American businesses and consumers are on foreign manufacturing. If we want to continue to grow American manufacturing, it is critical that we expand access to robotic automation solutions. We are extremely excited to launch Addtronics and partner with Brad and his team at DDS,” said Griffin Horter, a managing partner of Kaho.
Kaho specializes in acquiring family and founder-run businesses with greater than $2 million in EBITDA. The firm has an extended investment horizon and is backed by long-term investors who invest in businesses with the intention of holding them forever. Kaho has offices in New York City and Greenwich, Connecticut.
Kaho and Addtronics are actively searching for additional businesses to add to the Addtronics platform.
© 2023 Private Equity Professional | February 7, 2023
