Gryphon Investors has formed Thermal Technology Distribution Solutions (TTDS) as a new distribution platform in the industrial temperature products sector and has made its first acquisition with the buy of Big Chief.
Big Chief is an independent distributor of electric process heating and temperature control products used in a range of industries including consumer staples, water and infrastructure, automotive, specialty polymers and resins, building materials, and general industrial. Big Chief’s product line is expansive with products from numerous manufacturers including Chromalox, Durex, Ogden, Tempco, Barber Colman, and Leister.
Big Chief’s products include temperature controls and indicators; industrial heating cables and controls; nozzles, tips, barrels, and screws; heated hoses and insulation blankets, pressure transducers; and air, immersion, strip and drum heaters. Big Chief was founded in 1962 by James Howe Sr. and is headquartered in Cincinnati, Ohio.
Post closing, Jeff Howe, Big Chief’s chief commercial officer has been named as the company’s new president and Terry Howe, the company’s current president, will join the TTDS’ board of managers. Both executives are sons of the founder and will have an equity interest in TTDS.
“Now is the right time for us to enter a new phase of growth and we can’t imagine a better partner to provide us with financial and operational resources that will open additional avenues for development, while continuing to provide our customers with the quality and service they have come to expect,” said Terry Howe.
“Terry and Jeff have built a strong reputation among professionals as the premium provider in this industry, and we have already identified opportunities to further expand Big Chief’s market-leading position,” said Craig Nikrant, an operating partner at Gryphon. “We believe Gryphon’s investment will allow the company to accelerate organic growth, and, just as importantly, we will be actively pursuing add-on acquisitions that complement Big Chief’s core strengths and enable it to scale rapidly.”
“The thermal technology industry is rich with opportunities for the right platform, and we believe TTDS will be a compelling home for many like-minded companies in the sector,” said Tim Bradley, a managing director in Gryphon’s Heritage Fund. “Such strategic acquisitions will allow TTDS to serve its customers even better by deepening its capabilities in complementary products and expanding its share in attractive end markets.”
Gryphon has experience in the distribution sector. In January 2023, Gryphon sold its Atlanta-headquartered portfolio company Heritage Distribution Holdings, a multi-regional HVAC/R parts and equipment distribution platform serving the Southeastern and Midwestern United States with 64 branches in 10 states, to publicly traded Beijer Ref, a Sweden-headquartered distributor of commercial refrigeration, industrial refrigeration, and air conditioning products.
Heritage Distribution was formed by Gryphon to house its investments in Wittichen Supply, an Alabama-based wholesale distributor of HVAC/R equipment, parts, and supplies to the residential and commercial markets in the Southeastern United States (acquired in August 2021); Benoist Brothers Supply, an Illinois and Missouri-based HVAC/R distributor with 13 branch locations across Illinois, Indiana, Kentucky, Missouri, and Tennessee (February 2022); Ed’s Supply, a Tennessee-headquartered distributor of HVAC/R equipment with 19 locations across Arkansas, Georgia, Kentucky, and Tennessee (April 2022); and Coastal Supply, an HVAC/R equipment distributor servicing the East Tennessee market (October 2022).
The acquisition of Big Chief is the fifth platform by Gryphon’s small-cap Heritage Fund. In addition to Heritage Distribution the three others include Kano Laboratories, a Tennessee-based producer of branded oils and lubricants sold into industrial MRO and consumer markets (November 2020); Repipe Specialists, a California-based home services company providing lead generation, customer qualification, training and billings to plumbing companies that provide single and multi-family re-piping services (January 2022); and Vivify Special Ingredients, an Illinois-based provider of specialty organic colorants, functional ingredients, and additives used in consumer and industrial applications.
“Our history of using proactive sector initiatives to identify industry leaders in promising businesses has led us to a variety of successful investments, and we are excited about the opportunities we see for Big Chief as a standout in a very fragmented market,” said Keith Stimson, a partner and the head of the Heritage Fund team at Gryphon. “We also expect to leverage insights gained from Gryphon’s experience in value-added distribution and manufacturing businesses, particularly through our portfolio companies Techmer PM, Pacur, HDH, Vessco, and Vivify.”
San Francisco-based Gryphon makes leveraged acquisitions and growth investments in middle-market companies. The firm invests from $50 million to $300 million of capital in companies with enterprise values ranging from $100 million to $600 million. Sectors of interest include business services, consumer products and services, healthcare, industrial growth, and software.
Prestwick Partners was the financial advisor to Big Chief on this transaction.
© 2023 Private Equity Professional | September 19, 2023
