Hidden Harbor Buys Cloyes Aftermarket

Hidden Harbor Buys Cloyes Aftermarket

Hidden Harbor Capital Partners has acquired the aftermarket division of Cloyes Gear & Products, a subsidiary of American Axle & Manufacturing.

Cloyes is a designer, manufacturer and distributor of timing drive systems and components for replacement applications in the automotive aftermarket and high-performance racing segment. The company sells its products under the Cloyes and Dynagear brands to wholesale distributors, national and local retailers, re-packagers, and production engine builders. The company was founded in 1921 and is headquartered in Fort Smith, AR (www.cloyes.com).

“The Cloyes aftermarket team is very pleased to be partnering with Hidden Harbor,” said Mick Jordan, President of Cloyes. “Working in conjunction with the Hidden Harbor team will allow us to achieve our sales growth initiatives, including an expanded product line and new global distribution.  Their operational expertise, standard operating procedures, and process improvement knowledge coupled with Cloyes’ experienced senior management team provide a strong formula for creating future growth.”

Hidden Harbor makes investments in US-based companies with revenues between $50 million and $500 million and EBITDA from $5 million to $25 million. Sectors of interest include industrials, transportation and logistics, business services, and consumer products. The firm is based in Boca Raton (www.hh-cp.com).

“In partnership with Cloyes’ management, we look forward to continuing to provide superior service and products to our existing customers, as well as executing on geographic and product expansion growth opportunities,” said Chris Paldino, a Founding Partner at Hidden Harbor.

“Cloyes, in its nearly 100-year operating history, has established itself as the premier brand in timing systems and related components, recognized for its superior quality products, engineering capabilities, broad product portfolio, and customer service,” said Andrew Joy, a Principal at Hidden Harbor.

Back in 2006, Cloyes was a portfolio company of KPS Capital Partners. It became part of Hephaestus Holdings (HHI), a KPS company formed to consolidate automotive suppliers. In October 2012, HHI was sold to American Securities which merged it with Metaldyne to form Metaldyne Performance Group (MPG). MPG went public in December 2014 and was acquired by American Axle & Manufacturing in April 2017.

American Axle & Manufacturing (NYSE: AXL), the seller of Cloyes, is a Detroit-based manufacturer of automobile driveline and drivetrain components and systems. The company had revenues in 2017 of $6.3 billion and has 90 facilities in 17 countries with more than 25,000 employees (www.aam.com).

LBC Credit Partners provided financing for the buy of Cloyes by Hidden Harbor.

© 2018 Private Equity Professional | May 7, 2018

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