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The Riverside Company Exits Health & Safety Institute

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The Riverside Company has sold Health & Safety Institute (HSI), a provider of CPR, EMT and healthcare training materials and services. Riverside invested in the company that became HSI when it purchased American Safety & Health Institute in July of 2006.

Riverside grew HSI both organically and through three add-on acquisitions – Medic First Aid International in 2006; 24-7 EMS in 2008; and EMP Canada Services in 2010, which extended the company’s reach in Canada. Riverside also grew the company organically, largely through operating team efforts and building the HSI brand and suite of products and services. During Riverside’s six-year hold period revenues grew approximately 25% and EBITDA grew by more than 126%.

“We helped HSI grow aggressively by using every technique and tool available at Riverside,” said Riverside Managing Partner Loren Schlachet. “Our deal and operating teams worked with a great management team at HSI to continuously enhance its product and content library, improve HSI’s branding, drive sales, and increase market share.”

The Health & Safety Institute provides CPR, EMT and healthcare accreditation and training materials to more than 9,900 approved training centers in the U.S. and across several foreign countries representing over 36,000 instructors. The company develops, publishes and delivers training programs to meet workplace safety and health requirements. The company is based in Eugene, OR (www.hsi.com).

“Riverside helped Health & Safety Institute scale and grow into the largest privately held emergency care training and services company in North America,” said HSI CEO Bill Clendenen. “From acquisitions to management talent to operating expertise, Riverside met HSI’s needs, which made for a deeply rewarding relationship both personally and professionally. We invested in a vision, and we realized it successfully together.”

The Riverside Company is a private equity firm focused on the smaller end of the middle market (“SEMM”). Riverside specializes in investing in SEMM companies (those valued up to $200 million) and partners with management teams to build companies through acquisitions and value-added growth. Since 1988, the firm has invested in 290 transactions with a total enterprise value of more than $6 billion. The firm is headquartered New York with additional offices in Atlanta, Chicago, Cleveland, Dallas, Los Angeles, San Francisco, and London (www.riversidecompany.com).

Working with Mr. Schlachet on the sale were Principal Joe Lee, Operating Partner Jeff Tobin, Senior Associate Brad Resnick, and Finance Director Mary Anne McClaren. Riverside Origination Principal Amy Margolis worked with the deal team to facilitate the sale of the business.

Signal Hill acted as exclusive financial advisor to Riverside on the transaction, while Deloitte & Touche provided accounting and tax support and Jones Day provided legal counsel.

PEPD 8-9-12

Vance Street Capital Exits Klune Industries

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Vance Street Capital has sold Klune Industries, a manufacturer of aluminum, nickel, titanium and steel aerostructures, to Precision Castparts, a manufacturer of complex metal components and products.

Vance Street acquired a majority interest in Klune Industries in early 2010 and undertook a number of initiatives to improve operations. This included bolstering the management team, integrating a strategic acquisition and streamlining manufacturing processes. These activities served to nearly double revenue and significantly increase profitability.

“In all of our investments, we seek to provide the resources and operational expertise that will enable our portfolio companies to reach their full potential and attain the highest level of operating performance,” said Richard Crowell, partner at Vance Street. “Our partnership with Klune is a clear demonstration of the successful execution of this strategy.”

The sale of Klune to Precision Castparts is the first from Vance Street’s current fund.

Klune Industries is an aerospace contractor – manufacturing complex parts, assemblies and components for commercial aircraft, military aircraft and missile systems. The company specializes in manufacturing doors, nacelles, wings and other aerostructures for the commercial market, and missile systems components, fuel tanks, bomb racks, rotors, ground support and airframes for the military market. The company’s products can be found on the platforms such as Boeing’s 737, 747, 777, 787, Airbus’s A-320, A-350, A-380, and Gulfstream’s G650. Klune operates facilities in North Hollywood, CA, Spanish Fork, UT, and Kent, WA, and employs approximately 740 employees. The company is headquartered in Los Angeles (www.klune.com).

Precision Castparts is diversified manufacturer of complex metal components and products. It serves the aerospace, power, and general industrial markets. Products include large, complex structural investment castings, airfoil castings, forged components, and highly engineered, critical fasteners for aerospace applications. In addition, the company is a producer of airfoil castings for the industrial gas turbine market. Precision Castparts manufactures extruded seamless pipe, fittings, forgings, and clad products for power generation and oil & gas applications; commercial and military airframe aerostructures; and metal alloys and other materials to the casting and forging industries. The company is headquartered in Portland, OR (www.precast.com).

Vance Street Capital makes control investments in companies with enterprise values up to $200 million. Sectors of interest include aerospace and defense, medical components and devices, precision industrial manufacturing and business services. The firm is based in Los Angeles, CA (www.vancestreetcapital.com).

PEPD 8-8-12

Marlin Equity Partners Exits Servigistics

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It was announced today that PTC it has signed an agreement to acquire Servigistics, a developer of service lifecycle management software and a portfolio company of Marlin Equity Partners, for approximately $220 million in cash. The transaction is expected to be completed in September 2012.

Servigistics provides software solutions that enable companies to plan, manage and monitor their post-sale service business processes including service parts, field technician scheduling and routing, service knowledge and pricing management. Over the past 12 months Servigistics had approximately $80 million in revenue. The company is based in Atlanta, GA with regional headquarters in the UK, Japan and India (www.servigistics.com).

Marlin Equity Partners invests in businesses across multiple industries that are in the process of undergoing varying degrees of operational, financial or market-driven change. The firm is based in is a Los Angeles, CA (www.marlinequity.com).

PTC (Nasdaq: PMTC) enables manufacturers to achieve sustained product and service advantage. The company’s technology solutions transform the way products are created and serviced across the entire product lifecycle – from conception and design to sourcing and service. Founded in 1985, PTC employs over 6,000 and is based in Needham, MA (www.ptc.com).

RBC Capital Markets is acting as financial advisor to PTC. Blackstone Advisory Partners is acting as financial advisor to Servigistics and Marlin Equity Partners.

PEPD 8-8-12

Madison Dearborn Exits Bolthouse Farms

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Campbell Soup Company today announced that it has completed the acquisition of Bolthouse Farms from Madison Dearborn Partners for $1.55 billion in cash. Campbell will operate Bolthouse as a separate business unit and members of Bolthouse Farm’s senior management team will continue to lead the business. Jeff Dunn, the President of Bolthouse Farms, will report directly to Denise Morrison, Campbell’s President and Chief Executive Officer.

Bolthouse Farms makes and markets juices, refrigerated salad dressing and packaged carrots. The company, founded in 1915, employs about 2,100 people and is headquartered in Bakersfield, CA (www.bolthouse.com).

“We have acquired a terrific business that is a good strategic fit with Campbell’s existing portfolio and growth strategies. Bolthouse Farms has exceptional employees and fantastic products. This gives Campbell one of the leading positions in both the fast-growing packaged fresh food market and in healthy beverages and provides us with an opportunity to expand into adjacent segments that leverage exciting consumer trends,” said Ms. Morrison.

Madison Dearborn Partners has more than $18 billion of capital under management and makes new investments through its most recent funds, Madison Dearborn Capital Partners V and Madison Dearborn Capital Partners VI. Madison Dearborn invests in businesses across a spectrum of industries including basic industries; business and government services; consumer; financial services; health care; and telecom, media and technology services. The firm was founded in 1992 and is based in Chicago, IL (www.mdcp.com).

Campbell Soup Company is a global manufacturer and marketer of foods and simple meals, including soup and sauces, baked snacks and beverages. Founded in 1869, the company has a portfolio of market-leading brands, including “Campbell’s,” “Pepperidge Farm,” “Arnott’s” and “V8” (www.campbellsoup.com).

Blue Sage Capital Exits Ashbrook Simon-Hartley

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Blue Sage Capital has completed the sale of Ashbrook Simon-Hartley, a provider of separation services in the wastewater industry, to Swedish corporate buyer Alfa Laval. “This transaction is exciting for all parties and delivers strong returns to our investors,” said Peter Huff, Co-Founder and Managing Member at Blue Sage Capital. “We wish Ashbrook continued success with the Alfa Laval team.”

Ashbrook Simon-Hartley designs and installs liquid and solid separation technologies for the wastewater industry. The company has offices in the United States, the United Kingdom, Chile, and Brazil. Ashbrook is headquartered in Houston, TX (www.ashbrookcorp.com).

 

Blue Sage Capital invested in Ashbrook in 2005 and completed two follow-on acquisitions that expanded the company’s product offering. The private equity firm partnered with Ashbrook’s management team to achieve continued growth and increased profitability throughout Blue Sage’s ownership. “We were able to partner with an outstanding team at Blue Sage. Blue Sage provided active operational expertise, and we grew the business together. We are enthusiastic about the future with Alfa Laval,” said Bob Williams, President of Ashbrook.

Blue Sage Capital specializes in growth, recapitalization and buyout financings of smaller middle-market companies based in Texas and the Southwest. Most of Blue Sage’s investments are in established, profitable companies with $5 million to $100 million of revenue and $2 million to $8 million of cash flow at the time of investment. Blue Sage invests in a variety of industries, with each initial investment in a company ranging from $5 million to $15 million. The firm was founded by Peter Huff and Jim McBride and is based in Austin, TX (www.bluesage.com).

Alfa Laval is a provider of specialized products and engineering solutions based on its key technologies of heat transfer, separation and fluid handling. Alfa Laval is listed on Nasdaq OMX, and had annual sales of about SEK 28.6 billion (approx. 3.2 billion Euros) in 2011. The company has 16,000 employees and is based in Lund, Sweden (www.alfalaval.com).

Raymond James served as exclusive financial advisor to Ashbrook Simon-Hartley and Blue Sage Capital in connection with this transaction.

Cyprium Partners Exits Imperial Bag & Paper

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Cyprium Investment Partners announced today the realization of its investment in Imperial Bag & Paper Co. Cyprium invested $12 million in subordinated debt in Imperial in January 2007.

Imperial is a wholesale distributor of paper and plastic packaging and janitorial supplies sold to the food service industry and retailers nationwide. The company is based in Bayonne, NJ (www.imperialbag.com).

During Cyprium’s investment period, Imperial grew over 159% to $275 million in sales operating from over 500,000 square feet of warehouse space in Bayonne, NJ and Long Island, NY. Cyprium was instrumental in assisting with the growth of Imperial, which came through both geographic and channel expansion as well as through three add-on acquisitions completed during its holding period.

Cyprium provides capital for acquisitions, growth, shareholder or partnership buyouts, refinancings and personal dividend distributions, without requiring majority control. The firm provides capital via subordinated debt, preferred stock and/or common stock. Cyprium will also selectively invest in control (majority ownership) positions. The firm invests from $10 million to $60 million per transaction in privately-held companies based in the US and Canada with more than $8 million of EBITDA. Cyprium has offices in Cleveland, OH and New York, NY (www.cyprium.com).

Blue Point Capital Partners Exits Quality Synthetic Rubber

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Blue Point Capital Partners announced today that the firm has sold its interest in Quality Synthetic Rubber to Lexington Precision Corporation, a portfolio company of Industrial Growth Partners. “Blue Point was a true partner and provided very impactful operational and strategic support to the business. During our ownership by Blue Point, we have succeeded in building a global, market-leading electrical and medical components business serving diversified end markets. We have a fantastic team in place and a platform equipped for the next phase of growth,” said Randy Ross, chief executive officer of Quality Synthetic Rubber.

Quality Synthetic Rubber (“QSR”) is a manufacturer of highly engineered, molded silicone components serving the medical, automotive, heavy transportation and industrial markets. The company’s primary product line includes precision silicone seals that are integrated into automotive and industrial electrical connector assemblies and high precision silicone medical components such as vessel loops, IV components, catheters, and surgical and sterilization modules. The company was founded in 1966 and is based in Twinsburg, OH (www.qsr-inc.com).

Under the ownership of Blue Point, QSR’s revenue and EBITDA increased by more than 50 percent, China revenues grew four-fold, medical revenues increased five-fold and together the China and medical divisions now represent a large and rapidly growing portion of the overall business.

“We are extremely pleased with what we’ve been able to accomplish alongside the management team at QSR, driving significant growth and diversification while navigating an unprecedented downturn in 2009. We adopted a very clear value-creation plan at acquisition focused on diversifying the business beyond U.S. automotive via expansion of the medical segment and by benefiting from the rapid growth in the China market,” said John LeMay, a partner with Blue Point. “Execution of the strategy was driven by QSR’s exceptional management team together with Blue Point operating and China resources put in place to support the strategy.”

Blue Point Capital Partners is a lower-middle-market private equity firm specializing in recapitalizations, corporate divestitures and buyouts. Blue Point invests in manufacturing, distribution and service businesses generating $20 million to $200 million in revenue. The firm has offices in Charlotte, NC; Cleveland, OH; Seattle, WA and Shanghai, China (www.bluepointcapital.com).

Industrial Growth Partners provides equity capital to lower-middle market manufacturing and manufacturing services companies with revenues of $30 million to $100 million. The firm invests equity in a range of transactions involving a change of ownership, such as management buyouts, leveraged buyouts, corporate divestitures, recapitalizations and management buy-ins. The firm is based in San Francisco, CA (www.igpequity.com).

Onex Exits Center for Diagnostic Imaging

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Onex Corporation today announced that it has completed the sale of Center for Diagnostic Imaging (“CDI”) to Insight Imaging for proceeds to the Onex Group of $91 million. “CDI has been a successful investment for Onex and we are pleased with the outcome for everyone involved, including our shareholders and limited partners,” said Robert Le Blanc, a Managing Director of Onex. “We have thoroughly enjoyed our partnership with the management team and wish them continued success.”

Onex Corporation today announced that it has completed the sale of Center for Diagnostic Imaging (“CDI”) to Insight Imaging for proceeds to the Onex Group of $91 million. “CDI has been a successful investment for Onex and we are pleased with the outcome for everyone involved, including our shareholders and limited partners,” said Robert Le Blanc, a Managing Director of Onex. “We have thoroughly enjoyed our partnership with the management team and wish them continued success.”

The Onex Group acquired CDI in January 2005 with an equity investment of $73 million and has received total proceeds of $145 million, including a prior distribution. This results in a multiple of invested capital of 2x and a 10% rate of return. Onex’ portion of the proceeds is approximately $37 million, including $3 million of carried interest and the prior distribution.

The Center for Diagnostic Imaging provides outpatient radiology imaging services. The company currently owns and operates 60 diagnostic imaging centers in nine states, including Florida, Illinois, Indiana, Ohio, Minnesota, Missouri, South Dakota, Washington and Wisconsin. CDI partners with radiologists, hospitals and health systems to offer physician-led radiology services and the expertise of subspecialized radiologists focused on neurological, spine, musculoskeletal, body, breast and cardiovascular imaging, in addition to advanced diagnostic injections and pain management procedures. The company is based in Minneapolis, MN (www.CDIradiology.com).

Onex Corporation makes private equity investments through the Onex Partners and the ONCAP families of funds. The firm invests in small and mid-sized North American businesses with enterprise value of between $50 and $500 million. Onex has more than $15 billion of assets under management and is located in Toronto, Canada (www.onex.com).

Insight Imaging is a provider of fixed-site and mobile diagnostic imaging services to healthcare providers such as hospitals and physicians, and payors, such as managed care organizations, Medicare, Medicaid and insurance companies, in over 30 states, including the following targeted regional markets: California, Arizona, Texas, New England, the Carolinas, Florida and the Mid-Atlantic states. The company is headquartered in Lake Forest, CA (www.insighthealth.com).

Riverside Exits L-com

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The Riverside Company has sold L-com, a provider of wired and wireless connectivity products, to Odyssey Investment Partners. The sale generated a 2.6x gross cash-on-cash return and a 17% gross IRR for investors in the 2003 Riverside Capital Appreciation Fund.

General Electric Capital Corporation, CIT Finance, the Bank of Ireland, and Newstone Capital Partners, provided debt financing to support the acquisition by Odyssey.

L-com is a designer and manufacturer of wired and wireless connectivity products. The company’s product portfolio includes cable assemblies, connectors, adapters, industrial networking components, and custom connectivity products, as well as a line of wireless products. The company has over 10,000 SKUs across a range of product categories including cable assemblies and connectors, wireless local area network access points, and associated RFID support products. L-com has manufacturing and sales facilities in Suzhou, China, Boca Raton, FL and North Andover, MA and its products are sold directly to end users through its printed catalog, e-commerce website and dedicated sales forces, as well as through distribution partners. Customers include original equipment manufacturers, system integrators and network installers. The company was founded in 1982 and is headquartered in North Andover, MA (www.L-com.com).

Riverside invested in L-com in April 2006, and helped L-com grow its customer base, develop new products, improve operations, enter China as both an end market and manufacturer, and strengthen its management team. The 2007 add-on of HyperLink Technologies added wireless connectivity products, expanded the customer base and significantly increased international sales. “Riverside’s efforts helped L-com thrive through the global economic crisis, and left the company bigger and better upon exit,” said Riverside Partner Kristin Newhall. “Although we held L-com during a challenging time for the industry, the company added jobs and grew revenues and EBITDA during the hold period, leaving L-com poised for continued growth.”

Working with Ms. Newhall for Riverside on the sale were Vice President Meranee Phing and Senior Associate Robert Avery. Riverside Origination Principal Amy Margolis worked with the deal team to facilitate the sale of the business. Stifel Nicolaus Weisel advised Riverside on the transaction.

The Riverside Company is a private equity firm focused on the smaller end of the middle market (“SEMM”). Riverside specializes in investing in SEMM companies (those valued up to $200 million) and partners with management teams to build companies through acquisitions and value-added growth. Since 1988, the firm has invested in 290 transactions with a total enterprise value of more than $6 billion. The firm is headquartered New York with additional offices in Atlanta, Chicago, Cleveland, Dallas, Los Angeles, San Francisco, and London (www.riversidecompany.com).

Odyssey Investment Partners is a middle-market private equity fund with more than $2 billion under management. Odyssey makes controlled investments primarily in established middle-market companies in a variety of industries, including industrial manufacturing, business, financial and healthcare services, aerospace products, and localized and route-based service businesses. The firm is headquartered in New York, NY (www.odysseyinvestment.com).

“L-com is a strong platform poised for solid growth in the coming years. The company has combined outstanding in-house manufacturing operations and customer service with a sophisticated multi-channel marketing strategy to provide customers high-quality connectivity products. We are excited to work with L-com’s strong and experienced management team to expand the company’s leading market position through organic initiatives and strategic acquisitions,” said Randy Paulson, a Managing Principal of Odyssey.

Bertram Capital Exits Author Solutions

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Bertram Capital announced today the sale of Author Solutions, a provider of professional self-publishing services, to Pearson plc, the parent of Penguin Books Ltd, one of the largest traditional book publishers in the world, for $116 million in cash. The sale of Author Solutions marks Bertram Capital’s third portfolio company exit in the last nine months.

Since Bertram Capital’s investment in 2007, Author Solutions (“ASI”) has grown to be the world’s leading provider of professional self-publishing services. Bertram Capital acquired ASI in April 2007 and acquired iUniverse as its first add-on acquisition in October of 2007. After integrating iUniverse, the company then completed the acquisitions of Xlibris and Trafford in 2009. Beginning with a platform investment in a business with approximately $25 million in trailing revenue, these strategic acquisitions, aggressive business development and internal operational improvements expanded the business more than 4x over the ownership period. Author Solutions is based in Bloomington, IN (www.authorsolutions.com).

“ASI’s extraordinary growth and its impact on the self-publishing industry clearly demonstrate the capability our buy and build approach has to create market leaders that are attractive acquisitions for strategic buyers,” said Jeff Drazan, Managing Partner at Bertram Capital. “We successfully executed three add-on acquisitions for the ASI platform and grew the business more than 4x in just over five years, ultimately creating the world’s largest self-publishing business.”

Bertram Capital invests in middle-market business services, consumer, healthcare, industrial and technology companies. Bertram is currently investing out of its $500 million second fund and typically allocates $25 million to $100 million to each investment. Since the firm’s inception, Bertram has managed in excess of $850 million in committed capital and has completed 8 platform investments and 14 follow-on acquisitions. The firm is located in San Mateo, CA (www.bertramcapital.com).

“Working in partnership Kevin Weiss and his team at ASI for the past five years has been a great experience for the Bertram team,” said Jared Ruger, a Partner at Bertram. “Together, we transformed a slow growing, breakeven business into a fast-growing, consistently profitable innovator in its market that ultimately attracted the attention of a major strategic player. We achieved our goal of building a business that was both relevant and attractive to a strategic buyer. We wish Pearson well as they take the reins and lead ASI into the future.”

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