Energy and chemical-focused Black Bay Energy Capital has sold NexGen Chemical Technologies to Foremark Performance Chemicals, a portfolio company of SK Capital Partners.
NexGen is a provider of oilfield services and chemical technologies used in the upstream, midstream and downstream energy sectors. The company’s products are used to improve efficiency, environmental impact, and total cost of operations for exploration, production, and midstream operators.
NexGen was founded in 2018 by Black Bay CEO Chris Williamson and CTO James Begeal to develop chemical compounds for treating sour natural gas (also known as natural gas sweetening). Sour natural gas is a term used to describe natural gas that contains a significant amount of hydrogen sulfide (H2S), a colorless and toxic gas, that can be found in industrial processes, oil and gas operations, and wastewater treatment.
“We couldn’t have asked for a more committed, patient, and hard-working financial partner than the Black Bay team,” said Mr. Williamson. “Their experience in the oil and gas and chemical sectors, specifically their understanding of the sour gas landscape, was invaluable as we recruited key players to our team and scaled the business.”
NexGen specializes in non-triazine H2S scavenger chemistry, a type of chemical compound that is used to remove or neutralize H2S gas. More traditional H2S scavengers such as MEA triazine (aka monoethanolamine triazine) contain triazine compounds, which are effective but have certain limitations and environmental concerns.
On the other hand, non-triazine H2S scavenger chemistry offers an alternative approach that does not involve triazine compounds. As a more environmentally friendly compound, non-triazine H2S is increasingly being used in the energy industry instead of MEA triazine to control and eliminate H2S gas.
Foremark’s acquisition of NexGen will enable a rapid scale-up of manufacturing for ScavGen 1014, NexGen’s flagship non-triazine H2S compound.
Foremark Performance Chemicals specializes in the development, production, and distribution of specialty chemicals including natural gas sweeteners, chemical intermediates, and agriculture fertilizers. Foremark is headquartered near Houston in League City, Texas, and operates a high automation plant in La Porte, Texas, that is among the world’s largest triazine, formalin and UFC (Urea Formaldehyde Concentrate) production facilities. SK Capital acquired Foremark in May 2017.
“The market need for more efficient natural gas sweetening continues to grow, and Black Bay, Foremark, and SK all understand and appreciate how important this is,” said Mr. Begeal. “We are thankful for the partnership with Black Bay and we’re very excited to be partnered with Foremark and SK going forward.”
“The NexGen team has embodied what Black Bay looks for in a portfolio company management team. Chris, James, Ali Yousef, Dallas Watson, and the rest of the NexGen team are highly technical and driven market experts who were true partners. We are thankful for their partnership and thrilled to watch the next chapter of the NexGen story unfold under Foremark and SK Capital’s ownership,” said Guy Cook, a partner at Black Bay.
“Innovative, efficient, and economic technologies are required to enable the transition in energy and chemical markets,” added Tom Ambrose, a partner at Black Bay. “The NexGen team embraced these goals and built a world-class company and technology suite around this thesis. We are proud to have been a part of NexGen and excited to deliver a fantastic return to our investors.”
Black Bay invests up to $30 million in equity in North American energy and specialty chemical companies that have up to $25 million in EBITDA. New Orleans-headquartered Black Bay is currently investing out of its second fund and has $565 million of assets under management.
SK Capital invests in the specialty materials, chemicals, and pharmaceutical sectors and typically invests equity of $100 million to $200 million in each portfolio company. In February 2019, the firm held a final closing of SK Capital Partners Fund V LP with total capital of $2.1 billion. SK Capital is currently raising its sixth fund with a $2.75 billion target and a $3.5 billion hardcap. SK Capital was co-founded by Barry Siadat and Jamshid Keynejad and is based in New York City.
Houston-headquartered investment bank PPHB (Parks Paton Hoepfl & Brown) was the financial advisor to NexGen on this transaction. The PPHB team was led by Partner Joe Buchanan.
© 2023 Private Equity Professional | May 24, 2023
Patriot Pickle, a maker and distributor of pickles and a portfolio company of Swander Pace Capital, has acquired First Place Foods.
“The broader pickled and fermented foods category has enjoyed strong topline growth as consumers continue to gravitate towards healthier snacks, and Patriot Pickle is well positioned to take advantage of this consumer tailwind,” said Corby Reese a managing director at Swander Pace. “First Place Foods is the second acquisition for Patriot Pickle, and we believe there are additional opportunities to continue building out this exciting growth platform.”
Tendit Group, a portfolio company of Osceola Capital, has acquired Legends Landscape Management, a provider of commercial landscape services.
Denver-Headquartered 
“The acquisition of Legends Landscape is a perfect fit with Tendit’s growth strategy – partnering with the premier service provider in each of our core exterior facility service categories in each of our target states within the Mountain West,” said Patrick Watkins, a partner at Osceola. “Growing our presence in Arizona has been a top priority for Tendit, and we are excited to add the landscaping service offering to our existing Arizona operations and offer a more robust suite of services to our Arizona customers.”
PSC Group, a portfolio company of Aurora Capital Partners since July 2019, has acquired Steel Line Rail Services.
Trachte, a portfolio company of Palladium Equity Partners, has acquired Parkline, a portfolio company of Summit Park.
Going forward, Summit Park is maintaining an equity interest in the combined business in partnership with Palladium. “We have enjoyed our longstanding partnership with Parkline and are proud of the evolution and expansion of the business over the time of our investment,” said Bob Calton, co-managing partner of Summit Park. “Bill Estep and the entire Parkline team have done a great job executing the strategic vision of the company, resulting in significant growth and a reputation as a trusted industry leader. Summit Park looks forward to following Parkline’s future success.”
“Trachte has experienced strong growth over the past two years driven by multi-generational industry tailwinds, by delivering unmatched product quality and by adapting to serve the needs of its end users,” said Caleb Clark, a partner at Palladium. “We are pleased to support the Trachte team in their acquisition of Parkline, which will add significant capabilities and enhance its ability to serve a diverse set of customers, helping to advance the company as a leader in the P&CB sector. Since we invested in Trachte in 2020, Parkline has been on our radar as the top candidate to prove out our strategy to grow the business with acquisitions in this highly attractive market.”
Charlotte-headquartered 
New York City-based 
The Lincoln Private Market Index (LPMI), which tracks changes in the enterprise value of US privately held companies, increased by 1.5% during the first quarter of 2023.
“The direct lending market is at a bit of a crossroads at the moment,” said Ron Kahn, a managing director and co-head of Lincoln’s valuations and opinions group. “Interest in the asset class remains strong and credit terms have remained favorable for lenders; however, as rising rates persist, all-in yields can only remain in the mid-teens for so long. At some point something needs to break—either cracks start to form and defaults jump up or spreads start to move in the opposite direction to ease interest burden on PE portfolio companies.”
The Gores Group has agreed to sell automotive parts supplier US Farathane to Atlas Holdings.
The Gores Group acquired USF in January 2015. “We are proud of our successful partnership with Andy and the USF team, marked by a series of acquisitions that have accelerated the company’s expansion in Mexico and Asia,” said Alec Gores, the chairman and CEO of The Gores Group. “USF is another hallmark investment for Gores in the automotive industry, backing a company that delivers industry-leading products and solutions to various global OEMs. We are confident in USF’s bright future ahead with Atlas as an ongoing partner.”
KKR has agreed to acquire Industrial Physics, a manufacturer of testing and measurement instruments, from Union Park Capital.
“Testing and measurement is an attractive market that is poised to continue growing as focus on product quality and supply chain transparency intensifies,” said Brandon Brahm, a partner at KKR and Co-Head of KKR’s Ascendant strategy. “We are thrilled to invest in Industrial Physics, a leader in this space, which has built an impressive portfolio of brands used by many of the world’s leading manufacturers. We look forward to working with the Industrial Physics team and helping the company reach new heights through organic growth and M&A.”
Frontier Dental Lab Group, a portfolio company of O2 Investment Partners, has acquired Friendship Dental Laboratories.
“We are honored to partner with Friendship, a best-in-class dental lab that will be highly complementary to FDL Group and will bolster the platform’s presence in the Mid-Atlantic,” said Jimmy Frye, a vice president at O2. “George Diacoloukas is an outstanding leader, and we look forward to the collaboration between the Friendship and FDL Group teams.”
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 B2B services, technology, and select industrial companies.
Capstreet has added Dustin Hollas as a principal to its business development team and Alyssa Fox as a senior vice president to its marketing and operating executive group.
Mr. Hollas has more than 19 years of experience in the financial services industry and he has led all stages of deal sourcing from initial research of industry verticals through due diligence. From 2012 to 2017, Mr. Hollas managed the Houston market for Comerica Bank’s technology and life sciences group where he specialized in early, middle, and late-stage companies. He has his undergraduate degree in economics from Texas A&M.
In her new role at Capstreet, Ms. Fox will be working with the firm’s investment team and portfolio companies on brand and go-to-market strategies. Beginning in 2019, Ms. Fox was the vice president of channel marketing at Alert Logic, a Houston-based cybersecurity company. Earlier in her career, she held senior management positions in marketing and content development at multiple software companies, including Graylog, Micro Focus, and NetIQ. Ms. Fox has her undergraduate degree in history from Texas A&M.
