material handling equipment

Dunes Point Buys Material Handling Integrators

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Dunes Point Capital has formed Hy-Tek Holdings to acquire Hy-Tek Material Handling and WorldSource Integration. Both companies are active as integrators of material handling systems.

Hy-Tek and WorldSource provide new and used material handling equipment and integration services – including design, engineering, and installation – to the e-commerce, third-party logistics, and parcel processing sectors.

Hy-Tek was founded in 1963 and is employee-owned with 475 employees. The company is headquartered in Columbus, Ohio with five other locations in Georgia, Kentucky, New Jersey, Pennsylvania, and Tennessee. WorldSource, founded in 1998 with 70 employees, is headquartered near Chicago in Batavia, Illinois.

Equity for Dunes Point’s investment in Hy-Tek Holdings was sourced from Dunes Point Capital Fund II LP. The debt for the transaction was provided by M&T Bank.

Dunes Point is a family office and private investment firm that makes control investments in companies operating in the general industrial and business services sectors that have enterprise values of up to $1 billion. The firm was founded in 2013 by Timothy White, a former senior managing director of credit-focused hedge fund GSO Capital which was acquired in 2008 by Blackstone and renamed Blackstone Credit in 2020.

Alvarez & Marsal’s transaction advisory group was the financial advisor to Dunes Point. Alantra was the financial advisor to both Hy-Tek and WorldSource. Ropes & Gray provided legal services to Dunes Point. The Ropes & Gray team was led by partner Kendrick Chow and associate Joshua Coombes.

© 2021 Private Equity Professional | March 26, 2021

CenterGate Invests in Naumann/Hobbs

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CenterGate Capital has made an investment in Naumann/Hobbs, a provider of material handling equipment and services.

Naumann/Hobbs’ products include electric and internal combustion forklifts; pallet racks, conveyors, and industrial shelving units; and replacement parts with more than 50,000 parts in stock for all makes and models of equipment.

The company also provides 24/7 equipment maintenance and repairs; rents forklifts, aerial lifts, and industrial carts; and provides OSHA-mandated and technical training classes. Naumann/Hobbs, founded in 1949 and led by CEO Tom Hobbs, operates through a network of seven locations across the southwestern United States and is headquartered in Phoenix.

“We are excited about our partnership with CenterGate and it will allow us to continue to provide exceptional service to our customer base,” said Mr. Hobbs. “CenterGate’s investment will provide us the capital and strategic resources to continue to grow our market presence and geographic reach.”

“We are excited to partner with Tom and the entire Naumann/Hobbs team,” said Jeff Kovick, a principal at CenterGate. “The company has a long track record of success, and we look forward to working with the team to execute the vision for the future and continue that trajectory.”

CenterGate invests in lower middle-market companies that have from $20 million to $250 million of revenue and up to $20 million of EBITDA. Sectors of interest include business services, industrials, energy services, consumer, and healthcare. In December 2016, the firm held an above target and oversubscribed final closing of CenterGate Capital Partners I LP with $350 million of capital commitments. CenterGate is headquartered in Austin, TX.

© 2019 Private Equity Professional | September 9, 2019

New State Exits Central Conveyor

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New State Capital Partners has sold Central Conveyor Company to U.S. Tsubaki Holdings, a wholly owned subsidiary of Tsubakimoto Chain, for approximately $140 million.

Central Conveyor Company is a designer and installer of material handling and storage retrieval systems used by companies that are active in the automotive, parcel & logistics, and warehouse & distribution markets. The company’s services include custom controls and integration as well as electrical field wiring and support. Central Conveyor, led by CEO Rick Wells, was founded in 1993 and is headquartered near Detroit in Wixom, MI (www.centralconveyor.com).

New State acquired Central Conveyor in December 2014. During the term of ownership, the company launched new divisions in controls and tooling, acquired original equipment manufacturer KCI in March 2017, doubled its number of employees to 200, and built a new corporate headquarters in Wixom, MI.  As a result of these efforts, the company’s revenues increased by 374 percent and are now at more than $200 million.

“Central Conveyor has achieved tremendous growth by every measure over the last three and half years, expanding the business both organically and through acquisition,” said David Blechman, founder of New State Capital. “We worked closely with the company’s management team to help Central Conveyor realize these results, and we wish them future success under their new owners.”

Tsubakimoto Chain, the buyer of Central Conveyor, is a manufacturer and developer of power transmission products, materials handling systems, factory automation systems, physical distribution systems, and electronic control devices. The company’s products are used in a range of industries including machine tools manufacturing, mining, construction machinery, steelmaking, LCD production, semiconductor fabrication, and automotive. Tsubakimoto Chain is headquartered in Osaka, Japan (www.tsubakimoto.com).

New State invests from $10 million to $50 million of equity in companies with $8 million to $30 million of EBITDA. Sectors of interest include healthcare services, business services, and industrials. In March 2018, New State closed its second institutional investment fund, New State Capital Partners Fund II LP, at its hard cap of $255 million. The firm was founded in 2013 and is headquartered near New York City in Larchmont, NY (www.newstatecp.com).

Lincoln International (www.lincolninternational.com) was the financial advisor to New State Capital and Central Conveyor, and Duff & Phelps (www.duffandphelps.com), led by Managing Director Ray Newman, provided sell-side due diligence services.

© 2018 Private Equity Professional | June 18, 2018

THL Keeps Building MHS

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Material Handling Systems, a portfolio company of Thomas H. Lee Partners, has agreed to acquire VanRiet Material Handling Systems, a portfolio company of Avedon Capital Partners.

VanRiet designs, integrates, installs, and maintains automated sorting equipment used in courier, express and parcel services, e-commerce, and warehouse & distribution applications. The company, led by Chairman and CEO Rik van den Boog, was founded in 1948 and is headquartered near Rotterdam in Houten, Netherlands with additional locations in the US, UK, China and Poland (www.vanrietgroup.com).

Material Handling Systems (MHS) was acquired by Thomas H. Lee Partners in April 2017. MHS provides engineering services and equipment, project management, and installation services to the parcel industry with design, implementation, and maintenance of turnkey material handling sortation and distribution systems. Customers of MHS include some of the top logistics and e-Commerce companies in the world. The company currently operates out of seven facilities: one in Mt. Washington, KY; four in Louisville, KY; one in Wilmington, OH; and the MHS Canada headquarters in Toronto. The company, led by CEO Tony Mouser, was founded in 1999 and is headquartered in Louisville (www.mhsinc.net).

The buy of VanRiet is the third add-on acquisition for MHS in the past seven months. In November 2017, the company acquired Atronix, a provider of controls and software that are used in both factory automation and office automation in the material handling, warehouse distribution, automotive, and food & beverage markets. Also in November, MHS acquired Advanced Production Systems, a maker of electrical and pneumatic control panels.

Thomas H. Lee Partners (THL) was founded in 1974 and is one of the oldest private equity investment firms in the United States. Industries of interest include consumer and retail; healthcare; media and information services; and business and financial services. Since its founding, THL has raised over $22 billion of equity capital, acquired over 140 portfolio companies and completed over 360 add-on acquisitions. The firm is based in Boston (www.thl.com).

Avedon Capital Partners makes control and minority investments of €5 million to €30 million in companies that have from €15 million to €150 million of enterprise value. Sectors of interest include industrial & engineering; software & technology; business services; and consumer & leisure. The firm prefers to invest in the Benelux (Belgium Netherlands Luxembourg) region and Germany. Avedon has offices in Amsterdam and Düsseldorf (www.avedoncapital.com).

Robert W. Baird was the financial advisor to VanRiet on this transaction.

© 2018 Private Equity Professional | May 23, 2018

Duravant Acquires QC Industries

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Duravant, a maker of equipment used in the food processing, packaging and material handling sectors, has acquired QC Industries, a maker of conveyor systems. Warburg Pincus acquired Duravant in June 2017 from Odyssey Investment Partners which acquired the company in May 2013.

QC Industries is a manufacturer of conveyor systems, specializing in low profile conveyor designs and technologies. The company has three product lines: its Automation Series conveyors are built using a rigid aluminum frame, its Sanitary Series conveyors are built on easy-to-clean stainless steel frames and its Industrial Series conveyors are constructed with a single-piece steel frame. QC’s conveyors are customizable and are used by original equipment manufacturers and integrators across an array of industries and applications in the food, beverage, consumer packaged goods, foodservice, automotive, pharmaceutical, and medical industries.

QC Industries, led by CEO David Dornbach, was founded in 1981 and is headquartered near Cincinnati in Batavia, OH (www.qcconveyors.com).

Duravant is a manufacturer of engineered equipment that operates through three segments – food processing, packaging machinery and material handling. Duravant, led by CEO Mike Kachmer, is headquartered in the Chicago suburb of Downers Grove, IL (www.duravant.com). “Our partnership with QC Industries extends our overall solutions offering across our processing, packaging and material handling sectors,” said Mr. Kachmer. “Duravant has experienced tremendous growth in recent years by developing an evolving set of value-added solutions for our customers. QC Industries will certainly accelerate our efforts.”

Duravant’s food processing segment’s products are mainly used in the processing of pork, beef and chicken products for major food companies and are organized into three primary categories: pumps, fillers and dicers, and thermal equipment. This segment’s brand names include Marlen and Carruthers.

The packaging machinery segment’s product line is comprised of components and systems that fill, close, weigh and handle open mouth bags. The segment operates globally under the Fischbein brand name and provides a range of products from manual to semi-automated and fully-automated machines. These products serve a variety of end markets, including agriculture, food, pet food, chemicals and building products.

Duravant’s material handling segment manufactures conveying products that are used in distribution centers and retail stores for the loading and unloading of trucks. The company has a strong market position under the Flexible Material Handling and Best Conveyors brand names and provides products to both online and physical retailers.

Warburg Pincus has more than $44 billion in assets under management and has raised 16 private equity funds since its founding in 1966. In November 2015, the firm reached a final close of Warburg Pincus Private Equity XII LP at the hard cap of $12 billion. Warburg Pincus is headquartered in New York with offices in Amsterdam, Beijing, Hong Kong, London, Luxembourg, Mumbai, Mauritius, San Francisco, São Paulo, Shanghai and Singapore (www.warburgpincus.com).

© 2018 Private Equity Professional | March 12, 2018

MML Sells PaR to Pohlad

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The Pohlad family has acquired PaR Systems, a maker of robotic automation and material handling equipment, from MML Capital Partners which acquired the company in July 2008 from American Capital.

PaR’s robotic automation and material handling equipment are used in the aerospace, medical device, marine/defense, nuclear and industrial markets. The company’s products range from the very large to small scale. On the large side of the spectrum, PaR created a remote robotic application to facilitate the nuclear handling and decommissioning of the Chernobyl Unit 4 reactor and sarcophagus following the 1986 nuclear accident in Ukraine. More recently, PaR Systems undertook a similar project at the Fukushima nuclear site affected by the 2011 earthquake in Japan. On the other end of the spectrum, PaR supports medical device manufacturers by designing and building automation equipment for the manufacturing of small products that are often inserted into the human body.

The majority of PaR’s 380 employees are based in three US locations: near Minneapolis in Shoreview and Oakdale, MN; and south of Savannah in Brunswick, GA. The company was founded in 1961 and is headquartered in Shoreview, MN (www.par.com).

“We want to invest in companies that make a difference now and in the future,” said Robert Pohlad. “PaR Systems not only fits that criteria but allows us to expand into a new business line that we believe has great long-term potential. And it’s headquartered right here in our own backyard – sharing the same heritage and values.”

The Pohlad family’s operating companies include United Properties, NorthMarq Capital and Carousel Motor Group amongst others, and span several industries, including the automotive, real estate investment and development, radio and media, high-end jewelry and commercial real estate finance industries. The Pohlad family also owns Major League Baseball’s Minnesota Twins (www.pohladcompanies.com).

“Through the entire process of getting to know the Pohlad team, it has become clear to the senior team at PaR that the Pohlad family has the same high expectations and values as the people at PaR,” said Mark Wrightsman, President and CEO of PaR Systems. “We are excited to be joining forces with this great team to achieve our long-term vision of all of the companies in our chosen market segments recognizing PaR as ‘a Trusted Partner’ for their automation needs.”

MML Capital Partners, the seller of PaR, invests from €10 million and €50 million in private businesses for expansion, acquisitions, recapitalizations and management buyouts. The firm has offices in London, UK; Stamford, CT; and Paris, France (www.mmlcapital.com).

© 2017 Private Equity Professional | November 2, 2017