Platte River Equity has formed a new platform to acquire TIPCO Technologies and HydraTech Industrial, two distributors of fluid conveyance and sealing products.
TIPCO is a distributor of hydraulic and industrial hoses, fittings and connectors to OEM and MRO customers. The founding of TIPCO dates to 1888 but the company was incorporated as George P. Thomas Rubber Company in 1960. The company was acquired by Bob and Jane Lyons in 1983; changed its name to Thomas Industrial Products in 1987; and was renamed again in 1999 to TIPCO Technologies. In 2001, Rob and Terri Lyons acquired the company. TIPCO is headquartered near Baltimore in Owings Mills, Maryland, and operates through 13 branches in Maryland (4), Virginia (2) and Delaware (5), New Jersey and Pennsylvania; and 3 fabrication facilities.
HydraTech Industrial (formerly Fluid Power Holdings) was formed by JMH Capital through the acquisition of Alternative Hose in 2019 and seven follow-on acquisitions: Wilco Supply (2020), Power Product Technologies (2021), Hero Hose (2021), Pacific Rubber & Supply (2022), Atlanta Rubber & Hydraulics (2022), Speedraulics (2022), and A-1 Coupling & Hose (2023). Today, HydraTech is a Denver-headquartered national distributor of hydraulic and industrial hoses, fittings and connectors to OEM and MRO customers with branch locations in Arizona (3), Nevada (2), Georgia (2), North Carolina (2), Oregon, Idaho, Colorado, and Texas.
The combined HydraTech and TIPCO will now operate under the name TIPCO Technologies with 30 locations across the United States that serve customers in the infrastructure, manufacturing, transportation, government, agriculture/forestry, and energy sectors. TIPCO will be co-led by HydraTech CEO Brad Marshall and TIPCO CEO Rob Lyons.
“We are thrilled to be joining forces with Rob, Terri and the entire TIPCO family,” said Mr. Marshall. “TIPCO’s impressive presence in the Mid-Atlantic complements our footprint, opening up compelling greenfield expansion opportunities. Rob, Terri and the TIPCO team have built a terrific organization, and we look forward to continued growth and transformation.”
“TIPCO is excited to join forces with HydraTech, aiming for growth and unique career paths for our team of talented people,” said Mr. Lyons. “Building on TIPCO’s history of forward-thinking distribution, this partnership underscores our joint commitment to expansion, technology and people.”
“We have been following this business and sector for several years and believe it represents a unique opportunity to bring together these two great companies,” said Peter Calamari, a managing director at Platte River.
Platte River makes equity investments of $25 million to $100 million in lower middle-market companies with annual revenues of $20 million to $250 million and EBITDA from $7 million to $30 million. Sectors of interest include aerospace and transportation; energy products and services; industrial products and services; and agriculture and chemicals. Since its founding in 2006, the Denver-based firm has raised more than $1.3 billion in capital and is now investing out of its $625 million fourth fund which closed in June 2017.
“We are thrilled to be working with Brad, Rob, Terri and their teams in building a value-added distributor that leads through technology and innovation,” said Mike Reilly, a principal at Platte River.
Boston-headquartered JMH Capital, the seller of HydraTech, makes control investments of up to $30 million to acquire companies that have from $5 million to $100 million of revenue and $1 million to $10 million of EBITDA. Sectors of interest include industrials, services, and consumer.
Debt Financing for this transaction was provided by Apogem Capital.
© 2023 Private Equity Professional | December 8, 2023
