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Fenway Carves Up BRG Sports

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BRG Sports, a portfolio company of Fenway Partners, has entered into an agreement for publicly-traded Vista Outdoor to acquire the Action Sports business of BRG Sports for $400 million in cash plus an earn-out related to the future performance of the business.

BRG Sports is a designer, developer and marketer of sports equipment and accessories under the Bell, Riddell, Giro, Blackburn and C-Preme brands. The company was formerly known as Easton-Bell Sports and changed its name to BRG Sports in April 2014. BRG Sports is headquartered north of Santa Cruz in Scotts Valley, CA and has 32 locations in the US, Canada, Mexico, Europe and Asia (www.brgsports.com).

In the past two years, Fenway Partners has tried to sell BRG Sports in one piece but because of lawsuits and potential future liabilities related to its Riddell brand (football helmets) the firm has been marketing the company’s brands individually. The Action Sports business that is being sold to Vista Outdoor includes the Bell (motorcycling helmets), Giro (cycling and snowboarding helmets), Blackburn (cycling gear) and C-Preme (children’s helmets and products) brands.

BRG will apply the proceeds from the transaction with Vista to pay down debt, strengthen the company’s balance sheet and pursue growth initiatives that will benefit its remaining brand, Riddell. Riddell is a designer and developer of protective sports equipment including football helmets, shoulder pads, apparel, and related accessories (www.riddell.com).  BRG Sports’ current owners, Fenway Partners – though its second and third funds – and Ontario Teachers’ Pension Plan (Teachers), will maintain their equity interests in the company.

Fenway Partners makes control investments in businesses with $100 million to $600 million in enterprise value and $15 million to $75 million in EBITDA. Equity investments generally range from $50 million to $75 million. The firm is based In New York (www.fenwaypartners.com).

Teachers is one of the world’s largest private equity investors, having participated as a long-term investor in numerous management buyouts in Canada, the United States and Europe.  It is the private investment department of the Ontario Teachers’ Pension Plan, the largest single-profession pension plan in Canada.  Teachers’ is based in Toronto with offices in New York and London (www.teachersprivatecapital.com).

Vista Outdoor (NYSE: VSTO) is a designer, manufacturer and marketer of products used in the outdoor sports and recreation markets. The company was the top seller of ammunition in the United States from 2008 to 2013. As of March 2015, it controlled about 40% of the ammunition market. The company is headquartered north of Salt Lake City in Clearfield, UT (www.vistaoutdoor.com).

Morgan Stanley (www.morganstanley.com) was the financial advisor to BRG Sports and Ropes & Gray provided legal counsel (www.ropesgray.com).

© 2016 PEPD • Private Equity’s Leading News Magazine • 2-29-16

Blackstreet Sells American Combustion

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Blackstreet Capital Management has sold its portfolio company American Combustion to Timothy Kirlin, its Chief Executive Officer, and other members of the company’s management team.

American Combustion (ACI) is a mechanical engineering firm that installs and repairs boilers, chillers, HVAC units and other commercial mechanical systems. The company is headquartered northeast of Washington, DC in Brentwood, MD (www.aciindustries.com).

“My 10 year partnership with Blackstreet has been rewarding both financially and operationally,” said Tim Kirlin. “We jointly rescued this company from the prior owner and saved over 100 primarily union jobs in the DC area. During that time we turned a money losing operation into a growing enterprise and I look forward to the next 10 years as an independently owned business. I want to thank Blackstreet for giving me the opportunity and to thank them for what has been a great partnership for both of us.”

Blackstreet makes control equity investments of up to $15 million in companies that have revenues up to $150 million and total enterprise values up to $75 million. Target companies are located primarily in the Mid-Atlantic, Southeastern and Midwestern United States. Blackstreet is led by Murry Gunty, Founder and Managing Partner, and Lawrence Berger, Managing Director.

“It has been an honor to be partnered with Tim. From the first day when he approached me with the idea to purchase the company until the closing day of the sale, he has been a wonderful partner,” said Mr. Gunty. “I am pleased that we were able to rescue this company from likely liquidation, fix the operations, grow the sales, and position it for what I believe will be an amazing next 10 years under Tim’s ownership. I just want to thank Tim for being such a good partner.”

“Blackstreet can provide flexible capital for all types of situations,” said Mr. Berger. “We move exceptionally fast to understand and close transactions. In the case of ACI, we purchased the business three weeks from the time we were first notified of the company being available for sale.”

Blackstreet’s sectors of interest include niche manufacturing; catalogs and internet retail; consumer and industrial products; franchisors; value added distribution; specialty retail; education and training; healthcare services and devices; multi-unit restaurants; media and communications; and business services. The firm was founded in 2002 and is headquartered in Chevy Chase, MD (www.blackstreetcapital.com).

© 2016 PEPD • Private Equity’s Leading News Magazine • 2-29-16

IOP Sells Roadtrek Motorhomes

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Industrial Opportunity Partners (IOP) has completed the sale of its portfolio company, Roadtrek Motorhomes, to the Erwin Hymer Group, a Germany-based privately-held maker of recreational vehicles. IOP acquired Roadtrek in April 2011.

Roadtrek is a designer and manufacturer of Class B motorhomes. Class B motorhomes (also called camper vans) are built on the chassis of full-size cargo vans and include sleeping for two to four people as well as full bath and kitchen amenities with the living space contained within the dimensions of the van. Class B motorhomes are becoming more popular largely due to their smaller size and a chassis design that offers greater maneuverability, ease of driving, and fuel economy compared with other motorized RVs.

Roadtrek’s motorhomes are sold through a network of independent dealers in the United States and Canada. The company is headquartered southwest of Toronto in Kitchener, ON (www.roadtrek.com).

Industrial Opportunity Partners focuses on acquiring middle-market manufacturing and value-added distribution businesses, typically with revenues between $30 million and $350 million. The firm targets businesses with strong product, customer, and market positions and provides both management and operational resources to support sales growth and operational improvements.

IOP Operating Principal Andrew Weller served as Roadtrek’s Chairman of the Board and provided strategic oversight to the company during IOP’s term of ownership. “Through the leadership and dedication of the company’s management team, led by CEO & President Jim Hammill, Roadtrek has continuously improved its product offering and shown a consistent commitment to innovation,” he said. “Roadtrek has achieved substantial growth over the past few years, and I believe is positioned well for the future.”

The Erwin Hymer Group is among Europe’s largest manufacturer of motorhomes and caravans with annual revenues of €1.4 billion ($1.5 billion). The group sells more than 35,000 recreational vehicles under such brand names as Bürstner, Carado, Dethleffs, Hymer, Niesmann + Bischoff, Laika, LMC and Sunlight. The company also rents motorhomes under the McRent brand and sells tent trailers under the 3DOG camping brand. The Erwin Hymer Group has approximately 4,400 employees and is headquartered near Munich in Bad Waldsee, Germany (www.erwinhymergroup.com)

“IOP’s investment in Roadtrek was very successful, and IOP would like to thank the Roadtrek management team for their efforts in creating value in the business,” said Ken Tallering, a Senior Managing Director of IOP. “We believe the Erwin Hymer Group’s industry experience and long-term investment strategy suits the company well, and IOP expects Roadtrek will continue to grow and thrive under its ownership.”

The sale of Roadtrek is IOP’s seventh realization from its initial $185 million fund which was raised in 2006. In May 2012 IOP closed its second fund at the hard cap of $275 million.  IOP was founded in 2005 and is headquartered in the Chicago suburb of Evanston (www.iopfund.com).

Piper Jaffray & Co. (www.piperjaffray.com) was IOP’s investment banker for this transaction and McDermott Will & Emery (www.mwe.com) provided legal representation.

© 2016 PEPD • Private Equity’s Leading News Magazine • 2-25-16

Geneva Glen Sells Flow Polymers to Arsenal

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Geneva Glen Capital has sold its portfolio company, Flow Polymers, to Polymer Solutions Group, a portfolio company of Arsenal Capital Partners.

During Geneva Glen’s ownership, Flow Polymers organically doubled its earnings through international expansion and the introduction of new products and raw material sources. Flow Polymers is led by CEO Mike Ivany who will now serve as President and Chief Executive Officer of Polymer Solutions Group.

Flow Polymers, acquired by Geneva Glen in December 2010, is a manufacturer of chemical dispersions, process aids and homogenizing agents used in the tire, automotive, industrial products, wire and cable, and plastics markets. Chemical dispersions and agents are used by manufacturers to shorten the processing time and temperatures of thermoplastic resins such as polypropylene, polyethylene, polystyrene, ABS and nylon. Flow Polymers has approximately 500 customers and sells internationally in 30 countries. The company operates two chemical manufacturing facilities and is headquartered in Cleveland (www.flowpolymers.com).

“Geneva Glen was a true partner to me and the rest of the management team,” said Mr. Ivany. “During our tenure together, the company benefited significantly from the ongoing support and guidance provided by the Geneva Glen team.  While we are excited to transition to the next chapter at Flow Polymers, the relationship that we built with the principals at Geneva Glen will be enduring.”

Geneva Glen invests up to $50 million of equity per transaction in US and Canadian based lower middle-market companies that have EBITDAs between $3 million and $20 million. Sectors of interest include: business and consumer services; consumer products and food; environmental services; for-profit education and training; healthcare; niche industrial manufacturing; publishing, media and information services; specialty insurance and value-added distribution. The firm is based in Chicago (www.genevaglencapital.com).

“We are extremely grateful for the tremendous efforts put forth by Mike Ivany and the entire Flow Polymers management team.  Individually, and as group, they consistently found creative and resourceful avenues to grow revenue and expand margins.  It is always a joy to have a great result with an investment, and in particular, see a management team with the quality and integrity of Flow achieve a well-deserved financial result for themselves and the company’s investors,” said Adam Schecter and Jeff Gonyo, the founders and Managing Directors at Geneva Glen Capital, in a released statement.

Polymer Solutions Group (PSG) was formed by Arsenal in June 2015 when the firm acquired Peach State Labs. PSG develops polymers and other chemicals used in products that include flooring, textiles, coatings and paints, water treatment, and lubricants. The company was founded in 1987 and is headquartered northwest of Atlanta in Rome, GA with an additional facility in Dalton, GA (www.peachstatelabs.com).

“The buy of Flow Polymers builds on our strategy to create a diversified leader of high-value niche solutions serving customers in the polymers and plastics end markets,” said Sal Gagliardo, an Operating Partner in Arsenal’s Specialty Industrials Group. “Flow Polymers has a strong presence in automotive and industrial applications while Peach State Labs provides a number of unique technologies to the construction and lubricants market. We are excited to partner with Mike Ivany and his team to continue to grow the PSG platform.”

Arsenal Capital Partners invests in middle-market specialty industrial and healthcare companies that have $50 million to $250 million in enterprise value.  Industries of specific interest include specialty & fine chemicals; segments of healthcare; transportation and logistics; power generation; aerospace & defense; and process industry components and services.  Arsenal has $1.7 billion of committed capital under management. The firm was founded in 2000 and has offices in New York and Shanghai (www.arsenalcapital.com).

Arsenal intends to continue the build of PSG through new product launches and acquisitions. The effort is led by John Televantos, an Arsenal partner who co-heads the firm’s specialty industrials group.

Twinbrook Capital (www.twincp.com) and Kayne Anderson (www.kaynecapital.com), PSG’s existing lenders, provided debt financing to support the buy of Flow Polymers.  PSG was advised by Kirkland & Ellis (www.kirkland.com).

KeyBanc Capital Markets (www.key.com) was the financial advisor to Flow Polymers. Geneva Glen and Flow Polymers were advised by Katten Muchin Rosenman (www.katten.com).

© 2016 PEPD • Private Equity’s Leading News Magazine • 2-22-16

Ancor Exits Liguria Foods

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Ancor Capital Partners has sold its portfolio company Liguria Foods, a maker of pepperoni, to CTI Foods, a portfolio company of Thomas H. Lee Partners and Goldman Sachs & Co.

Ancor, along with co-investor Brown Brothers Harriman Capital Partners, acquired Liguria Foods in 2008 as a part of a spin-out of from its larger parent Specialty Food Group. At the time of the spin-out Liguria Foods was known as Humboldt Sausage Company.

Today, Liguria manufactures branded and private-label pepperoni that is sold to independent and multi-unit pizzerias and sandwich shops. The company supplements its pepperoni products with additional lines of protein pizza toppings and other dry sausage products. The company was founded in 1974 and is headquartered 80 miles north of Des Moines in Humboldt, IA (www.liguriafoods.com).

“We are extremely proud of the accomplishments that Liguria has made over the eight years since we acquired the company,” said Ray Kingsbury, Managing Director at Ancor. “When we originally were presented the investment opportunity, we were able to identify an executive team to transition Liguria into an independent entity, and partnered with Brown Brothers Harriman to buy the division. Since the acquisition, we’ve made strategic investments in the team and the plant in order to grow the company. Liguria also experienced organic growth by adding new customers and further penetrating existing customers. We are deeply appreciative of the management team and the partnership they embraced with Ancor and BBH.”

Ancor Capital Partners invests in companies with enterprise values of $25 million to $150 million that have EBITDAs from $5 million to $15 million. Sectors of interest include manufacturing, distribution, health care, consumer staples, and outsourcing. The firm is based in Fort Worth (www.ancorcapital.com).

BBH Capital Partners, a private equity fund sponsored by Brown Brothers Harriman & Co., invests between $25 million and $100 million per platform investment and can act as either a control or non-control investor. Typical transactions include management or leveraged buyouts, growth financings, recapitalizations (including dividend recapitalizations), buy-and-build strategies and acquisitions. BBH Capital Partners is based in Boston (www.bbh.com).

Investment bank BlackArch was retained by Ancor Capital Partners and BBH as their financial advisor on this transaction. BlackArch was founded in 2010 by Kelly Katterhagen, Matt Salisbury, Drew Quartapella, and Bram Hall. The firm is headquartered in Charlotte with an additional office in Houston (www.blackarchpartners.com).

© 2016 Private Equity Professional • 2-17-16

OMERS Sells Marketwired to Nasdaq

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OMERS Private Equity has agreed to sell its portfolio company Marketwired LP to New York-based Nasdaq. The transaction is expected to close before the end of March.

Marketwired, acquired by OMERS Private Equity (OPE) in 2006, is a news wire service used by investor relations and public relations professionals for news distribution and media management. The company is led by CEO Adnan Ahmed. Marketwired was founded as Internet Wire in October 1994 and is today headquartered in Toronto (www.marketwired.com).

In July 2010, Marketwired – under OPE ownership – acquired Sysomos, a social monitoring and analytics service which provides its customers the ability to track their social media activity across Facebook, Twitter, and other social media sites. Marketwired and Sysomos separated in 2015 and Sysomos will remain under OPE’s ownership. Sysomos is headquartered in Toronto (www.sysomos.com).

“Marketwired has been part of OPE since 2006 and has been a strong contributor to our returns,” said Michael Graham, a senior managing director at OPE. “The sale to Nasdaq is a logical step in the company’s evolution.” Marketwired has had a marketing partnership – its services are recommended to listed companies – with NASDAQ since April 2003.

The sale of Marketwired by OPE follows the December 2015 purchase of PR Newswire by Cision, a portfolio company of GTCR. Cision, acquired by GTCR in February 2014, is a subscription and cloud-based provider of public relations and marketing software that is used by public relations and corporate communications professionals to manage public relations campaigns, including content distribution, media monitoring and media analysis. Cision is headquartered in Chicago with additional offices in Canada, UK, France, Germany, Portugal, Sweden, Finland and China (www.cision.com).

OMERS Private Equity manages the private equity activities of OMERS, one of Canada’s largest pension funds. The group’s investment strategy includes the active ownership of businesses in North America and Europe. Sectors of interest include manufacturing, financial and business services, industrial and consumer products, transportation, and technology. Investment sizes range from $100 million to $500 million. The firm is located in Toronto with offices in New York and London and has $6 billion of investments under management (www.omerspe.com).

Morrison & Foerster (www.mofo.com) is providing legal counsel to both Marketwired and OMERS Private Equity.  The transaction team at Morrison & Foerster is led by New York-based, M&A partner and Co-Chair of Global Private Equity, Jonathan Melmed. Also on the transaction team are New York Partners Enrico Granata (M&A), Michelle Jewett (Tax), John Delaney (IP transactional) and Domnick Bozzetti (Compensation & Benefits), Palo Alto partner Christine Lyon (Employment) Washington, DC partner Jonathan Gowdy (Antitrust), of counsel Aki Bayz (Antitrust), New York M&A associate Lisa Bozman and visiting international attorney Rafael Zabaglia and New York associate Ken Nicholds (IP transactional).

BMO Capital Markets (www.bmo.com) served as financial advisor to Marketwired and OMERS Private Equity.

© 2016 Private Equity Professional • 2-12-16