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Palladium Buys Kymera from Platinum

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Palladium Equity Partners has acquired Kymera International, a maker of specialty materials used in the metallurgical, chemical and industrial processes industries, from Platinum Equity.

Kymera’s specialty materials are produced as powders, pastes, ingots and granules and include aluminum and aluminum alloys, copper and copper alloys, copper oxide, lead, magnesium, tin, and zinc in a range of shapes and particle sizes from coarse to ultrafine. The company, with more than 1,500 customers, has manufacturing plants in seven countries across the US, Australia, Europe, and Asia. Kymera is led by CEO Barton White and is headquartered in Research Triangle Park, NC (www.kymerainternational.com).

The operations of Kymera include ACuPowder International, ECKA Granules and SCM Metal Products. Platinum first invested in the business in October 2008 and its operations were rebranded under the Kymera name in February 2017. Under Platinum’s ownership, Kymera grew from two copper powder plants to become one of the largest manufacturers of specialty aluminum and copper powders worldwide.

Kymera’s operating units have a long history and have been producing metal powders for over 100 years. ECKA Granules can trace its roots back to 1876 and it opened its first metal powder facility in 1918; ACuPowder was founded in 1916 as The Metals Disintegrating Company to manufacture metal powders; and SCM Metal Products was founded as Glidden Metals Company, a maker of copper powders, in the early 1930s and was acquired by Smith-Corona Marchant (SCM) a typewriter manufacturer in 1967.

“Kymera’s success reflects the culmination of a strategy to acquire multiple specialty material companies across the globe and integrate them operationally under one brand,” said Platinum Equity Partner Jacob Kotzubei. “Starting with the carve-out of SCM Metal Products, we partnered with management to build on the platform over time, and supported the company’s organic growth through investments in R&D and deployed our M&A&O resources to source and execute three add-on acquisitions. The result is a high-performing, well-diversified business with a dynamic leadership team led by Barton White.” Platinum’s “M&A&O” strategy refers to the firm’s active integration of traditional M&A with operational expertise.

Palladium is acquiring Kymera in partnership with the company’s management team. The growth strategy for the business includes expansion of the company’s product portfolio as well as pursuing complementary acquisitions in the specialty materials industry. “We are proud of the results we have achieved under Platinum, and thank them for their support over their ownership period,” said Mr. White. “We look forward to working with Palladium and leveraging their industry experience to accelerate our expansion plans.”

“Barton and the rest of the Kymera leadership team have built a leading specialty materials manufacturer with a reputation for delivering excellent service, deep technical expertise, and complete reliability to its customers,” said Adam Shebitz, a Managing Director of Palladium. “We are excited about Kymera’s next chapter of growth.”

Palladium invests from $50 million to $150 million of equity in companies that have $10 million to $75 million of EBITDA.  Sectors of interest include food and consumer, services, industrials, and healthcare. Palladium has a focus on companies that operate in the US Hispanic market.  Since its founding in 1997, Palladium has invested over $1.9 billion of capital in more than 31 platform investments and completed over 100 add-on acquisitions. The firm is based in New York (www.palladiumequity.com).

Platinum Equity invests in a range of industries including manufacturing, distribution, transportation and logistics, equipment rental, metals services, media and entertainment, technology, and telecommunications. The firm is currently investing from Platinum Equity Capital Partners IV, a $6.5 billion buyout fund which closed in March 2017 and Platinum Equity Small Cap Fund, a $1.5 billion buyout fund which closed in July 2018. Platinum Equity has completed more than 200 acquisitions since its founding in 1995. The firm is headquartered in Beverly Hills (www.platinumequity.com).

Lazard Middle Market was the financial advisor to Kymera and KeyBanc Capital Markets was the financial advisor to Palladium.

© 2018 Private Equity Professional | October 11, 2018

O2 Adds-On to Alpha Sintered Metals

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alpha-sintered-metals-nf1Alpha Sintered Metals, a portfolio company of O2 Investment Partners since January 2014, has acquired Precision Compacted Components.

pcc-nf33Precision Compacted Components (PCC) is a producer of sintered metal products used in automotive variable valve timing and variable cam timing applications. Sintering is the process of compacting and forming a solid mass of material by heat or pressure without melting it to the point of liquefaction. PCC was founded in 1994 and is headquartered 130 miles northeast of Pittsburgh in Wilcox, PA. The company, led by CEO Hugh Dornisch, has an additional facility in nearby St. Marys, PA (www.pccpm.com).

Alpha Sintered Metals (ASM) is a designer and manufacturer of powdered metal components, such as spur, bevel, and helical gears; sprockets, cams, and flanges. These components are used primarily in small engines, transmissions and mechanical drive applications for the outdoor power equipment (including lawn and garden), automotive, and general industrial markets. The company is headquartered in Ridgway, PA (www.alphasintered.com).

This is the second add-on acquisition completed by ASM this year. In May 2016 the company acquired Precision Made Products (PMP), a producer of sintered metal parts used in the medical, aerospace, and firearms markets. PMP is headquartered in Brunswick, OH (www.pmp-tech.com).

Each of ASM, PCC and PMP remain as separate operating companies but are owned by Alpha Precision Group (APG), a holding company formed by O2 Investment Partners.

jay-hansen-nf1“The PCC management team is highly respected within the industry and has worked closely with the ASM management team in the past,” said Jay Hansen, Managing Partner of O2 Investment Partners. “We are very excited about the opportunities for growth created by bringing these three businesses together under the APG umbrella. In this case, one plus one plus one truly equals five for this family of businesses.”

“PCC is a highly regarded supplier in the variable valve timing and variable cam timing market segment. Alpha Sintered Metals is primarily focused on providing products that are consistent with reducing emissions, improving fuel economy, and enhancing engine performance, thus making PCC an ideal strategic fit. We are thrilled to add PCC and their variable valve and variable cam technology and expertise to the APG portfolio and look forward to expanded participation in this high-growth segment,” said JoAnne Ryan, CEO of Alpha Precision Group.

o2-investment-partners-nf33O2 Investment Partners makes control investments in companies with EBITDAs from $2 million to $10 million located anywhere in the US and Canada but has a preference for the Midwest and the Great Lakes regions. The firm’s typical transaction size is $5 million to $75 million. Sectors of interest include niche manufacturing, niche distribution, select service businesses, and certain technology businesses. O2 Investment Partners is based in the Detroit suburb of Bloomfield Hills (www.o2investment.com).

© 2016 Private Equity Professional • 11-9-16

Cyprium Exits Alpha Sintered Metals

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ASM Nf1Cyprium Partners has sold its investment in Alpha Sintered Metals to the management of the company and O2 Investment Partners. Key Principal Partners, the predecessor to Cyprium Partners, first invested in Alpha Sintered Metals in 2004.

Alpha Sintered Metals (ASM) is a designer and manufacturer of powdered metal components, such as spur, bevel, and helical gears; sprockets, cams, and flanges. These components are used primarily in small engines, transmissions and mechanical drive applications for the outdoor power equipment (including lawn and garden), automotive, and general industrial markets. The company is headquartered in Ridgway, PA (www.alphasintered.com).

“ASM has been a prime example of the type of initiatives we pursue with our portfolio companies,” said Leland Lewis, a Managing Partner at Cyprium. “We team with management to assist with organic growth, acquisitions and operational improvements in order to position our companies to withstand a changing marketplace and to take advantage of growth opportunities. We wish the ASM team much success as they start the next chapter in the company’s history.”

In addition to its original subordinated debt and equity position, Cyprium invested additional capital in ASM to allow the company to establish off-shore manufacturing operations as well as to facilitate the acquisition of a competitor in the stainless steel exhaust and turbocharger components market.

Cyprium Partners provides capital for acquisitions, growth, shareholder or partnership buyouts, refinancings and personal dividend distributions, without requiring majority control. The firm invests subordinated debt, preferred stock and/or common stock of $10 million to $60 million per transaction in privately-held companies based in the US and Canada that have more than $10 million of EBITDA. Cyprium will also selectively invest in control (majority ownership) positions. In June 2011, as a result of the Dodd–Frank Wall Street Reform and Consumer Protection Act, the investment and finance teams at Key Principal Partners resigned to form Cyprium Partners. The firm has offices in Cleveland, New York, and Chicago (www.cyprium.com).

Stout Risius Ross (www.srr.com) led the sale process for Cyprium.

© 2014 PEPD • Private Equity’s Leading News Magazine • 1-27-14

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