Wind Point Partners has agreed to sell Interface Performance Materials to publicly-traded Lydall for $265 million in cash.
Interface designs and manufactures fiber-reinforced gasket materials that are used by OEMs and Tier I suppliers in heavy-duty diesel, small engine, transmission, compressor and automotive applications. The company also makes composite materials used in calendar bowl paper, heat shields and electrical barriers.
Interface, led by CEO Victor Swint, has manufacturing facilities in the US, Germany, and India and is headquartered in Lancaster, PA (www.interfacematerials.com).
Wind Point acquired Interface in December 2011. “Interface is a great example of how Wind Point’s strategy of partnering with a top caliber CEO to build a world-class management team can deliver tremendous value for our investors,” said Nathan Brown, a Managing Director at Wind Point. “We’re grateful to Victor and his team for their leadership in driving excellence throughout the organization, which resulted in best-in-class organic growth and operating margins.”
In 2017, Interface had sales of $142 million and adjusted EBITDA of $26 million and is expected to achieve sales of $150 million and adjusted EBITDA of $29 million for the trailing 12 months ending August 31, 2018. Based on these results the exit multiple for this transaction is 10.2x 2017 adjusted EBITDA and 9.1x TTM adjusted EBITDA.
Lydall (NYSE: LDL) is a designer and manufacturer of filtration media, industrial thermal insulating products, and automotive thermal and acoustical barriers. The company sells its products to original equipment manufacturers and tier-one suppliers in the life sciences, energy & utilities, construction, industrial, and transportation sectors. Revenues for Lydall in FY 2017 were approximately $700 million. Lydall, led by CEO Dale Barnhart, was founded in 1879 and is headquartered in Manchester, CT (www.lydall.com).
Wind Point invests from $50 million to $100 million in companies with EBITDAs of at least $10 million. Industries of interest include business services, consumer products and industrial products. In June 2017, Wind Point held a final closing of its eighth fund, Wind Point Partners VIII LP, with $985 million of capital commitments. The fund exceeded its initial hard cap of $750 million and marks the largest fund closing in Wind Point’s history. The firm was founded in 1984 and is based in Chicago (www.wppartners.com).
Reed Smith (www.reedsmith.com) was the legal advisor to Wind Point Partners and Interface on this transaction. The Reed Smith deal team was led by partners Morley Fortier and Brad Schmarak, and associates Nick Gibson, Lauren Siler and Ross Williams.
The transaction is expected to close in the third quarter of 2018.
© 2018 Private Equity Professional | August 14, 2018
