Gryphon Acquires Safety Management Group From NMS Capital

Gryphon Investors has acquired Safety Management Group, a provider of outsourced safety services, from NMS Capital which acquired SMG through its $570 million fourth fund in 2020.

Safety Management Group develops and executes safety and compliance programs that minimize risk and promote safe operations in complex industrial environments, including the utility, pharmaceutical, biopharmaceutical, manufacturing, semiconductor fabrication and data center sectors. The company performs site safety assessments; builds and implements customized safety programs; embeds safety leaders in customer operations; provides field execution support; delivers hands-on training; and manages contractor and supplier compliance.

SMG supports its services with its proprietary VERO SaaS platform, which streamlines contractor pre-qualification and provides compliance tracking and real-time visibility into safety performance data. SMG, led by CEO Randy Gieseking, was founded in 1991 and has approximately 300 credentialed safety professionals. The company is headquartered in Indianapolis.

“Gryphon’s deep experience growing similar technical services businesses will position SMG to take advantage of robust organic and M&A opportunities,” said Mr. Gieseking. “We look forward to working closely with the Gryphon team and their differentiated, integrated deal and operations model as we continue to innovate and build upon our success.”

“We are excited to partner with Randy and the SMG team to grow the business and further position the company as a market leader,” said Jeff Pembroke, operating partner and co-head of Gryphon’s Heritage Group. “Gryphon’s investment is the result of a proactive theme-based approach, as we recognize the significant importance of safety across many of our portfolio companies and the broader services sector. SMG has built a strong reputation as the go-to provider for outsourced safety consulting and has demonstrated consistent growth in essential industries with strong tailwinds.”

Gryphon is based in San Francisco and makes leveraged acquisitions and growth investments in middle-market companies. The firm invests from $50 million to $500 million of capital in companies with enterprise values ranging from $100 million to $600 million and EBITDA of up to $80 million. Sectors of interest include business services, consumer products and services, healthcare, industrial growth, and software.

“We believe there is an opportunity to continue to scale a market-leading business by expanding geographic presence, further building out the company’s existing offerings, and executing on strategic M&A in the fragmented environmental, health, and safety market,” said Tim Bradley, a deal partner in Gryphon’s Heritage Group. “SMG stood out to us as an industry leader with extremely talented employees and long-standing, embedded relationships with customers who view the Company as a true value-added partner. We are excited to work with the entire SMG team.”

NMS Capital makes equity investments of $25 million to $75 million in North America-based business services and healthcare services companies that have EBITDA of $5 million to $25 million. NMS was founded by former Goldman Sachs merchant banking professionals in 2010 and acquired a group of the firm’s portfolio companies. Today, NMS is headquartered in New York City, with an additional office in Dallas, and has approximately $1.6 billion of assets under management.

During its ownership term, NMS completed one add-on acquisition for SMG with the buy of Indiana-based Trinity Safety Group in April 2023.

Houlihan Lokey was the financial advisor to Gryphon, and Stifel was the financial advisor to Safety Management Group.