Archives for August 9, 2024

Incline Exits ASP Global

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After a 4.5 year hold and four add-on acquisitions, Incline Equity Partners has sold ASP Global, a medical products distributor, to Platinum Equity.

ASP sells more than 3,400 SKUs of products to health systems, labs, group purchasing organizations (GPOs), and integrated delivery networks (IDNs). ASP’s consumable products—sourced from more than 150 factories in 15 countries—are sold under six categories: lab supplies, blood collection, wound and injury protection, critical care, staff apparel, and rehab mobility.

Source: ASP Global

Specific product examples from ASP include patient amenity kits, slipper socks, scrubs and clinician apparel, disposable personal protective equipment (PPE), thermometers, maternity kits, cups and cutlery, pressure-infuser bags, pill cutters, tourniquets, blankets, and stethoscopes. ASP is led by CEO Doug Shaver and is headquartered near Atlanta in Austell, Georgia.

“Our partnership with Incline has allowed us to complete four acquisitions, adding new product categories and expanding the breadth of the existing portfolio,” said Mr. Shaver. “Our team has enjoyed the dynamic partnership with Incline, which has positioned us for continued growth.”

The four add-on acquisitions were Ohio-based Shumsky Therapeutic Pillows (March 2020); Georgia-based Primo (June 2021); Tennessee-based RAM Scientific (December 2022); and Tennessee-based MediCore Medical Supply (June 2023).

“We are proud that ASP has more than doubled revenue since our investment in January 2020,” said Tom Ritchie, a partner at Incline. “Together, we strengthened the commercial team, driving organic growth through new hospital system wins and increasing wallet share with existing customers.”

Incline Equity invests in North America-based companies with enterprise values of $25 million to $750 million. Sectors of interest include services, value-added distribution, and specialized light manufacturing. In October 2023, Incline closed its sixth fund, Incline Equity Partners VI LP, with $1.9 billion of capital. The Pittsburgh-based firm was formed in 2011 and is led by its Managing Partner Jack Glover and Senior Partner Leon Rubinov.

Platinum has experience investing in the healthcare products distribution industry. In March 2021, it acquired Nashville-headquartered NDC from Court Square Capital Partners. NDC is a distributor of branded and private label healthcare supplies with specializations in the medical, dental, physical therapy, long-term care, homecare and specialty markets. As NDC serves a different part of the medical supplies market, ASP and NDC will operate as separate, standalone companies in Platinum Equity’s portfolio.

“Healthcare providers are intensely focused on managing costs and increasing control of their supply chains,” said Louis Samson, a co-president of Platinum. “By providing direct sourcing solutions featuring customized, quality products, ASP has created an attractive value proposition. Based on our assessment, ASP’s business model has resonated with customers and has significant room for growth.”

Platinum Equity invests in a range of industries including manufacturing, distribution, transportation and logistics, equipment rental, metals services, media and entertainment, technology, and telecommunications. Beverly Hills-headquartered Platinum was formed in 1995 by Tom Gores and over the past 28 years has completed more than 450 acquisitions.

“ASP has an experienced management team that has articulated a compelling vision for the future,” said Jason Price, a managing director at Platinum Equity. “We have a shared belief in what ASP can become and are excited to get to work. ASP has a lot of runway to continue expanding organically and we expect to be active in pursuit of additional M&A opportunities, too.”

Solomon Partners was the financial advisor to Platinum Equity on the ASP acquisition.

© 2024 Private Equity Professional | August 9, 2024

New Water Sells Trillium to Rebranded Avista

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New Water Capital has sold Trillium Health Care Products, a contract development and manufacturing organization (CDMO), to Avista Healthcare Partners.

Trillium is a short and medium production run contract manufacturer and formulator of prescription and over-the-counter products in solid, semi-solid, and liquid dosage forms. The company’s product categories include gastrointestinal remedies, cough and cold medications, antiseptic ointments, suppositories, nasal sprays, allergy relief products, analgesics, and sleep aids. Trillium has more than 300 employees and is headquartered 130 miles southwest of Montreal in Brockville, Ontario.

Source: Trillium Health Care Products

New Water acquired Trillium in August 2018 through its $406 million inaugural fund. “New Water has been a transformational partner for Trillium,” said Joe Ruffo, the CEO of Trillium. “The support and significant investment New Water provided Trillium has set us apart from our competition. We see significant market opportunities and are excited for our next phase of growth with Avista, a growth-oriented partner with sector expertise in consumer healthcare.”

“New Water worked with management over our investment period to transform Trillium into a best-in-class, full-service CDMO with an outstanding reputation in the industry,” said Jason Neimark, a managing partner at New Water. “We appreciate all the hard work and investment by the New Water and Trillium teams to position Trillium for rapid future growth.”

“Our acquisition of Trillium represents another exciting investment for Avista in the attractive consumer healthcare sector,” said Alex Yu, a partner at Avista. “Trillium is a best-in-class, full-service CDMO with an outstanding reputation in the industry. We had been tracking Trillium for a number of years prior to this acquisition and are delighted to finally partner with Joe and the rest of the Trillium management team to help drive the next phase of the company’s growth.”

Earlier this week, Avista announced a rebranding of the firm from Avista Capital Partners to Avista Healthcare Partners to better reflect the firm’s transition from a generalist fund to a specialized healthcare-focused fund more than a decade ago. Avista has raised three dedicated healthcare funds that invest in high-growth middle-market product and technology healthcare companies located in both North America and Europe. Avista’s most recent fund, Avista Healthcare Partners III LP (Fund III), closed above target in February 2024 with $1.5 billion of capital commitments.

“I am proud of the strong reputation we have built within the healthcare landscape, and we are excited to formally align our firm’s name with our investment focus and identity,” said David Burgstahler, the CEO of Avista. “Avista has consistently delivered top-tier performance in the healthcare sector, and our team has exited 33 of our investments delivering $12.2 billion of proceeds on $4.2 billion of invested capital representing a 2.9x gross MOIC and 29% gross IRR. The rebrand crystallizes our market position and reinforces our commitment to our strategy.”

“Trillium’s strong culture and expertise, dedication to quality, and diversified blue-chip customer base form an excellent foundation for Avista and the Trillium management team as they enter the next chapter of the company’s growth,” said Nathan Douglas, a vice president at New Water.

New Water invests in lower middle-market companies with revenues between $30 million and $300 million that are active in the consumer, retail and industrial manufacturing and services sectors. The firm was founded in September 2014 and is based in Boca Raton, Florida.

The acquisition of Trillium is the sixth investment for Avista’s Fund III and follows the February purchase of Terrats Medical, a Barcelona-based manufacturer of dental prosthetics, from Miura Partners.

Avista makes control or influential minority investments in growth-oriented healthcare businesses with specific interests in outsourced pharma and medtech services; consumer healthcare; medical devices; specialty and generic pharmaceuticals; distribution and diagnostics; and healthcare technology. The firm was founded in 2005 and is headquartered in New York City.

Piper Sandler & Co. was the financial advisor to Trillium on this transaction.

© 2024 Private Equity Professional | August 9, 2024

Bansk Group to Buy PetIQ at $1.5 billion Valuation

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Bansk Group has agreed to acquire PetIQ, a provider of pet focused medication, health and wellness services, in a transaction valued at approximately $1.5 billion.

PetIQ has two operating segments. Its products segment includes prescription medications, over-the-counter treatments, and health and wellness products sold under the PetArmor, VetIQ, and Sentry brands; and its services segment provides veterinary care through community clinics, wellness centers, and partnerships with retail locations, which serve over 1.2 million pets annually across 42 states.

Source: PetIQ

PetIQ operates over 2,600 mobile community clinic locations and wellness centers that are hosted at retail stores across the United States. Specifically, the company has more than 130 permanent wellness centers within retail partners like Walmart and Meijer. These clinics provide preventive veterinary care services, making it convenient and affordable for pet owners to access necessary health services for their pets.

PetIQ is headquartered near Boise in Eagle, Idaho. In addition to its products and services segments, the company has over 780,000 square feet of EPA and FDA-licensed and SQF-certified manufacturing space, producing more than 1,000 SKUs of pet products, including flea and tick control products, dental treats, dog and cat treats, stain and odor treatments, and nutritional supplements. The four manufacturing facilities are located in Nebraska, Utah, Florida, and Texas.

PetIQ’s TTM Adjusted EBITDA as of March 2024 was $106 million. Based on the $1.5 billion valuation, this equates to a valuation multiple of 14.1x.

The acquisition of PetIQ has been approved by its board of directors. “On behalf of PetIQ’s board of directors, we are thrilled to announce the execution of a definitive agreement with Bansk Group at a substantial premium for PetIQ stockholders,” said Cord Christensen, the founder, chairman, and CEO of PetIQ. “After a comprehensive assessment of the offer with the assistance of our outside advisors, the board has determined that this transaction represents an attractive outcome for PetIQ and our stockholders.”

“Cord and the entire PetIQ team have done a fantastic job developing a comprehensive pet health and wellness platform that offers effective and accessible solutions for pet owners,” said Chris Kelly, a senior partner at Bansk Group. “We are thrilled to partner with the PetIQ team and look forward to leveraging our expertise in building distinct, trusted consumer brands to support the company’s continued success.”

Bansk invests from $100 million to $400 million of equity in consumer brands with specific interest in four sectors: beauty and personal care, health, food and beverage, and household products. In July 2023, the consumer-focused firm held a final close of its inaugural fund, Bansk Fund I LP, with $800 million of capital. Bansk was founded in 2019 and is based in New York City.

Bansk’s senior management team is led by a group of executives with decades of consumer-focused investing and operating experience. The firm’s senior partner and chairman, Bart Becht, was previously the CEO of Reckitt Benckiser, a UK-headquartered multinational consumer goods company specializing in health, hygiene, and home products; and Brian O’Connor, the firm’s senior partner and chief investment officer, was previously at Vestar Capital Partners for nearly 20 years. Other partners at Bansk include Chris Kelly, formerly at TPG Growth, and Bill Mordan, formerly at Reckitt Benckiser.

“As longtime investors in the consumer health and wellness space, we believe PetIQ has developed a portfolio of uniquely differentiated brands in the very attractive pet health and wellness category,” said Bart Becht, a senior partner and the chairman of Bansk Group. “We look forward to working with the talented PetIQ team to support their strong momentum, including through investments in enhanced capabilities and offerings as well as through strategic acquisitions.”

Jefferies is the financial advisor to PetIQ on this transaction, which is expected to close in the fourth quarter of 2024.

© 2024 Private Equity Professional | August 9, 2024

L Squared Continues Heavy Lifting at Crane 1

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Crane 1 Services, a portfolio company of L Squared Capital Partners, has acquired Standard Crane & Hoist.

Standard Crane is a provider of overhead crane inspections, repairs and maintenance, parts, and new cranes with eight locations across Louisiana, Mississippi, and Texas. The company is headquartered near New Orleans in Destrehan, Louisiana.

Standard Crane can trace its origins back to 1909 when it was founded by Cal Hadden as the Standard Supply Company, a provider of industrial supplies to companies operating in the Gulf Coast region. Beginning in 1990, under the management of President Mac Hadden, the grandson of the founder, the company pivoted to the overhead crane market and was renamed Standard Crane.

Source: Crane 1

“Our team at Standard Crane has built an incredible company. Providing great products and excellent service to our customers is and will always be our main priority. We have grown by investing in the crane-specific expertise of our employees who in turn produce the quality cranes and services for which we are known,” said Mr. Hadden.

Crane 1 provides services and equipment for industrial and commercial users of new and refurbished overhead cranes and hoists. The company’s services include inspections, maintenance, repair, design and installation. Crane 1, led by President and CEO Thomas Boscher, was founded in January 2007 and is headquartered just north of Cincinnati in West Chester, Ohio.

L Squared’s third fund acquired Crane 1 from Pfingsten Partners in August 2021, and the purchase of Standard Crane is the company’s fourth add-on acquisition under L Squared’s ownership. This follows the acquisitions of Pennsylvania-based D&S Hoist and Crane (February 2022), North Carolina-based Hoist & Crane Systems (May 2022), and Pennsylvania-based Magnetic Lifting Technologies (September 2022).

With the close of the acquisition of Standard Crane, Crane 1 now has nearly 500 employees and operates in 30 locations across 18 states.

“The purchase of Standard Crane aligns well with our Crane 1 strategy of growing through highly selective acquisitions with companies that have excellent reputations in the overhead crane market while allowing us to expand our geographic service footprint,” said Mr. Boscher. “The combination of our companies adds another strategic building block for Crane 1 as a leading, independent technical field service company focused on providing safe and exceptional solutions which lead to enhanced equipment uptime and reliability for our customers.”

“Standard Crane is a high-quality company and shares the key values we seek in partners as we expand our national footprint,” said Sean Barrette, a partner at L Squared. “It has deep customer relationships grounded in exceptional customer service which is a strong foundation for us to grow long term in the southern United States market. We are excited to welcome Mac and his team to the Crane 1 family and look forward to building our footprint in the region in the coming months and years.”

Newport Beach, California-based L Squared invests from $50 million to $125 million of equity in North America-based companies that have revenues of $20 million to $125 million and EBITDA of $5 million to $30 million. Sectors of interest include tech-enabled services and software, education technology, and industrial technology and services.

L Squared is led by Robert Healy, Jeff Farrero, Sean Barrette, Randall Hunt and Adam Kimura, all of whom worked together at Chicago Growth Partners prior to founding L Squared in July 2014. In November 2023, L Squared held the final closing of its fourth fund with $840 million of capital. The firm’s earlier fund closed in September 2020 with $505 million of capital.

© 2024 Private Equity Professional | August 9, 2024