Platte River Equity has acquired CTS Engines – a provider of maintenance, repair and overhaul (MRO) to owners and operators of commercial jet engines – from Palm Beach Capital. In November 2013, Palm Beach Capital acquired a 60% equity interest in CTS Engines from Neff Capital Management, which retained a 40% ownership interest.
CTS provides MRO services for a variety of engine platforms but specializes in the overhaul of the General Electric CF6-80C2, CF6-80A and CF6-50 engines, as well as the Pratt & Whitney PW2000. CTS’ MRO services are provided at the company’s 60,000 sq. ft. operating facility and headquarters in Fort Lauderdale. The company also operates a commercial engine test facility – the highest thrust independent commercial test facility in the world with a 155,000 pound-force capability – located in Jupiter, FL. CTS is led by CEO Brian Neff (www.ctsengines.com).
“We are delighted to have the opportunity to partner with Brian Neff and his team as they continue to serve as a critical partner to customers such as Boeing, GE, DHL, Air Transport Services Group, Atlas Air, Western Global Airlines and other operators of the CF6 engine,” said Platte River Managing Director Greg Sissel. “As a firm with deep aerospace sector experience, we have looked at numerous MRO businesses over the years and believe CTS’ combination of mature engine MRO expertise and next generation engine testing capabilities uniquely positions the company in the aircraft engine services market.”
Platte River makes equity investments of $20 million to $80 million in lower middle-market companies with enterprise values between $40 million and $250 million. The firm focuses on investing in the aerospace and transportation; energy and industrial products and services; and chemicals, metals, minerals and agriculture sectors. The firm invested capital out of its third fund, Platte River Equity III, LP, to acquire CTS. Platte River is based in Denver (www.platteriverequity.com).
Houlihan Lokey (www.HL.com) served as the debt placement agent on this transaction and New York based Annaly Middle Market Lending (www.annaly.com) provided financing. Charlotte-based investment bank BlackArch Partners (www.blackarchpartners.com) was the sell-side advisor to CTS.
© 2016 Private Equity Professional • 7-28-16