Compass Precision, a portfolio company of Main Street Capital, has acquired Gray Manufacturing Technologies.
Gray Manufacturing is a maker of precision metal components specializing in multi-axis machining, testing, and assembly. The company’s components are used in space, aerospace, and defense applications. Gray Manufacturing is headquartered 25 miles north of Charlotte in Denver, North Carolina.
Main Street formed Compass Precision in October 2019 to consolidate its investments in the precision metal manufacturing industry and its holdings include Quality Products & Machine, Advanced Machining & Tooling; and Tri-Tec Industries. All three companies are located in the Charlotte metropolitan area and were acquired from ZP Enterprises, an Atlanta-based private equity firm led by Steve Zelnak, the former chairman and CEO of Martin Marietta.
The combination of these four acquisitions allows Compass Precision, led by CEO Gary Holcomb, to provide advanced machining services, including electrical discharge machining (EDM); and fabrication, assembly, and testing services to the aerospace, defense, space, medical, industrial, energy, and telecommunication industries.
“When we formed Compass Precision, our plan was to grow aggressively, both organically and via acquisition,” said Mr. Holcomb. “Gray Manufacturing is an incredibly well-run precision manufacturer that is experiencing rapid growth by serving a select group of highly attractive customers and end-markets. They are a perfect fit for us.”
“The strong management team and infrastructure that we have in place at Compass provides us with the ability to seamlessly integrate a series of add-on acquisitions,” said Ryan Davis, a managing partner of Main Street. “The industry is very fragmented and there are a lot of companies like Gray that would be a good fit with Compass. We’re actively looking for additional add-on opportunities.”
“Both Compass and Gray have shown tremendous resiliency through the extremely challenging COVID-19 pandemic,” added Mr. Davis. “The strong performance has been driven by a diverse set of capabilities, customers, and end-markets served.”
Main Street Capital invests in North American-based companies that have enterprise values of $10 million to $125 million and at least $2 million of EBITDA. Sectors of interest include food products, industrial manufacturing, electronics, metallic alloy parts manufacturers, specialty or niche manufacturing, and value-added distribution. The firm, founded in 1994, is led by Dennis Prado and Ryan Davis and is based in Pittsburgh.
Private Equity Professional | September 9, 2020