PE Weekly: Sponsors Shift Focus Away from Add-Ons

For the last year or so, add-ons remained a popular focus for private equity sponsors in lieu of larger acquisitions, thanks to high interest rates and expensive credit. But with interest rates falling and the M&A market continuing to recover, investors may be shifting their focus. This week, acquirers focused on carve-out deals, minority and majority acquisitions, and even a few exits.

Platform Investments

Littlejohn & Co. Acquires Manufacturer Sunbelt Modular. Littlejohn & Co., a middle-market investment firm focused on the industrial and services sectors, announced its acquisition of Sunbelt Modular. Sunbelt designs and manufactures modular solutions for a variety of commercial end markets, according to a press release.

Renovus Capital Acquires Majority Stake in Performive. Private equity firm Renovus Capital Partners announced it acquired a majority stake in managed IT services provider Performive, which services middle-market enterprise clients. A press release said Renovus’ backing will support product innovation, enhanced customer experience and other growth initiatives at Performive.

Monomoy Backs Oliver Packaging in Latest Carve-Out. In its 20^th corporate carve-out transaction, private investment firm Monomoy Capital Partners announced its acquisition of Oliver Packaging and Equipment. Oliver manufactures food packaging systems and bakery equipment. Monomoy previously invested in packaging company mac Papers + Packaging, also a carve-out deal.

H.I.G., Thoma Bravo to Acquire IT Business CompTIA. Alternative investment firm H.I.G. capital and software-focused investment firm Thoma Bravo have announced their joint acquisition of CompTIA, an IT certification and training business. CompTIA provides both training services and products. The firms expect the transaction to close in early 2025.

Comvest Backs Dentistry Business. Comvest Private Equity, a middle-market private equity firm, announced its majority acquisition inf Riccobene Associates Family Dentistry. The dental services organization marks the 14^th healthcare services platform investment by Comvest’s PE strategy, a press release noted.

Sagewind Capital Backs Sabel Systems. Sagewind Capital, a private equity firm focused on government technology, announced its acquisition of Sabel Systems Technology Solutions this week. Sable Systems provides digital R&D and acquisition solutions to the U.S. Department Defense, as well as other government agencies to drive digital transformation.

Strategics

Lincoln International Acquires Tech Investment Banking Advisor. Lincoln International, an investment banking advisory firm, announced its acquisition of TCG Corporate Finance, a European technology advisory firm serving the private equity community. The boutique investment banking advisor expands Lincoln International’s team to more than 150 professionals, according to a press release.

Atlas Holdings Exits Iconex to Domtar Corporation. Atlas Holdings, a group of manufacturing and distribution businesses, has announced the exit of Iconex North America, a paper receipt solutions business. Atlas formed Iconex in 2016 to acquire NCR Corporation’s Interactive Printer Solutions division. The company was later formed into a standalone business. Domtar Corporation, a sustainable paper and packaging business, acquired Iconex, the press release noted.

Exits

Union Capital Exits FITCRUNCH, Bakery Barn. Private equity firm Union Capital Associates, which targets the lower-middle market, has announced the sale of two portfolio companies. FITCRUNCH and Bakery Barn, two brands that both operate in the high-protein snack space, have been sold to 1440 Foods, a portfolio of sports and active nutrition brands. 1440 Foods is backed by Bain Capital and 4×4 Capital.

One Equity Partners Exits Dragonfly to FIS. One Equity Partners, a middle-market private equity firm, has announced the sale of Dragonfly Financial Technology to financial and banking technology company FIS. Dragonfly provides digital business banking and cash management solutions. OEP carved out the ACI Digital Business Banking Solutions unit from ACI Worldwide in 2022, rebranding the unit to Dragonfly.

Fundraising

Saw Mill Capital Raises $435 Million for Fund III. Saw Mill Capital, a middle-market private equity firm focused on the industrial services, professional services and engineered products sectors, announced the close of its third fund. The firm secured $435 million in capital commitments for the oversubscribed fund, which is more than 25% deployed to three portfolio companies.

Middle Market Growth is produced by the Association for Corporate Growth. To learn more about the organization and how to become a member, visit www.acg.org.