KPS Capital Partners has completed a $50 million dividend recapitalization of its portfolio company Electrical Components International which it acquired in May 2014. The recapitalization was funded by a $50 million upsizing of the company’s existing term loan from a syndicate of banks and institutional investors with BofA Merrill Lynch acting as Lead Arranger.
Electrical Components International (ECI) is a manufacturer and marketer of wire harnesses and a provider of assembly services for the home appliance industry and other end markets. ECI has over 800 customers globally and its products can be found in a variety of electronic and electro-mechanical applications, including home appliances, agriculture and construction, heating, ventilation and air conditioning, specialty transportation, automotive, commercial appliance, and commercial electronics. ECI was founded in the 1950s and is headquartered in St. Louis with 14 manufacturing facilities, 14 distribution centers and sales and engineering offices located in North America, South America, Asia, Europe and Africa. The company has over 14,000 employees worldwide (www.ecintl.com).
Since being acquired by KPS, ECI has added a new manufacturing facility in Morocco, won new business in both appliance and specialty-industrial end markets, and completed the December 2014 add-on acquisition of Global Harness Systems, a Philadelphia-based manufacturer of wire harnesses and panel assemblies for the bus, power generation, specialty vehicle and marine equipment end-markets (www.globalharness.com).
“In ECI’s first year under KPS’ ownership, performance has exceeded our expectations. This recapitalization validates ECI’s significant strategic accomplishments under KPS ownership, and we are pleased to return capital to our stockholders,” said David Webster, Chief Executive Officer of ECI.
This is the third dividend recapitalization completed by KPS in the past two months. In July, KPS recapped American & Efird Global, the largest US manufacturer and the world’s second-largest manufacturer and distributor of industrial and consumer sewing thread, embroidery thread and technical textiles. KPS acquired A&E from Harris Teeter Supermarkets in November 2011. Financing for this recapitalization was provided by Merrill Lynch, HSBC, JP Morgan, and PNC Capital Markets.
Also in July, KPS recapped Anchor Glass Container which it acquired in April 2014. Anchor Glass is a manufacturer of glass packaging products for the beer, liquor, food, beverage, ready-to-drink and consumer end-markets. Financing for this recapitalization was provided by a bank group led by Credit Suisse and Barclays Bank.
KPS Capital Partners is the manager of the KPS Special Situations Funds, a group of private equity funds with approximately $5.6 billion of assets under management, that invests in restructurings, turnarounds and other special situations. KPS targets manufacturing and industrial companies that are going through a period of transition or experiencing operating or financial difficulties. The firm’s portfolio companies have aggregate annual revenues of approximately $6 billion, operate 98 manufacturing plants in 23 countries, and employ over 42,000 people worldwide. KPS Capital Partners is headquartered in New York (www.kpsfund.com).
© 2015 PEPD • Private Equity’s Leading News Magazine • 8-12-15
