PE Weekly: PE Firms Create an Exit Wave

Consumer products has been among the most challenging markets for middle-market dealmakers in the last year or so, but this week, the sector enjoys a burst of dealmaking activity. Plus, as PE firms face growing pressure to return capital to LPs, a wave of exits hits the landscape. Read about the latest transactions below.

Platform Investments and Acquisitions

Monomoy Invests in Southern Exteriors. Monomoy Capital Partners, a middle-market private investment firm, has invested in Southern Exteriors, an installer of exterior building solutions. Monomoy Managing Director Lee Mlotek pointed to the firm’s experience in building products distribution and installation as key to driving future growth for Southern Exteriors.

Turnspire to Acquire Ashland Neutraceuticals. Turnspire Capital Partners, a special situations private equity investment firm, has announced it reached an agreement to acquire Ashland Neutraceuticals. Ashland provides proprietary nutrition ingredients and custom formulations for nutritional product companies. Turnspire expects to complete its acquisition in the third quarter of this year.

Add-Ons

PSP’s Ntiva to Acquire The Purple Guys from Kian Capital. Lower middle-market private equity firm Kian Capital Partners is selling The Purple Guys, a managed IT services provider. Ntiva, a portfolio company of PSP Capital, will acquire the business. Kian first acquired The Purple Guys in 2020 with a majority recapitalization and merger of Enterprise Computing Services. Since, the business completed 10 add-on acquisitions.

Godspeed’s SAS Acquires Quintron Systems. Lower middle-market private equity firm Godspeed Capital Management, which is focused on the defense and government services market, has announced Special Aerospace Services (SAS) has acquired Quintron Systems. SAS is Godspeed’s recently-launched space engineering, defense an communications technology platform. Quintron provides secure communications technology for the space and defense markets.

Transom’s HALO Dream Acquires BreathableBaby. HALO Dream, a designer, developer, marketer and distributor of infant accessories and apparel, has acquired BreathableBaby, a manufacturer of breathable mesh for a variety of baby products. HALO Dream is a portfolio company of Transom Capital Group, a middle-market private equity firm.

VSS Capital’s Olympus Cosmetic Acquires Artisan. Olympus Cosmetic Group, a cosmetic surgery and dermatological treatment platform backed by VSS Capital Partners, has completed its acquisition of Artisan Plastic Surgery and Artisan Beauté. A press release said VSS made an additional investment in Olympus to support the transaction, its first acquisition.

Exits

Swander Pace Exits Functional Formularies to Danone. Private equity firm Swander Pace Capital, which focuses on consumer products, announced that it has completed the sale of Functional Formularies, a provider of organic, shelf-stable feeding tube formulas. Food conglomerate Danone acquired the business. Swander Pace first invested in the business in 2018.

Littlejohn Exits Talent Solutions Business to Kelly. Global specialty talent solutions provider Kelly has entered into an agreement to acquire Motion Recruitment Partners from private investment firm Littlejohn & Co., according to a recent press release. Motion Recruitment is a global staffing platform that includes Motion Recruitment, Motion Telco and other businesses that offer IT staffing services and IT solutions. Kelly is acquired the assets for $425 million in cash.

Delos Capital, Silverfern Exit Pioneer Recycling Services. Lower middle-market private equity firm Delos Capital and middle-market investment management firm The Silverfern Group have announced the exit of Pioneer Recycling Services. The residential recycling service provider was acquired by Waste Connections. Financial terms of the transaction were not disclosed.

Fundraising

Palm Beach Capital Raises More than $350 Million. Palm Beach Capital, a middle-market private equity firm, has closed its sixth fund with more than $350 million in capital commitments. Palm Beach Capital Fund VI exceeded its initial fundraising target of $275 million.

Insights

ACG Houston Awards Private Equity Deal of the Year. ACG Houston has announced the winner of its Private Equity Deal of the Year. The ACG chapter chose the acquisition of PlanetBids, an eProcurement SaaS company, by lower middle-market private equity firm Capstreet, for the honor. Capstreet acquired the company in June 2023. “It is an honor to be recognized once again by the ACG, which has its pulse on Houston’s middle market deal community,” said Adrian Guerra, Partner at Capstreet.

ACG Detroit Announces Women’s Forum Award Winners. Ahead of its Inspire and Ignite: Women’s Forum Luncheon, ACG Detroit has announced the winners of its Igniting Inspiration and Inspiring Impact Awards. Antonia R. Giles, associate at Dykema, has won the 2024 Igniting Inspiration Award; Terrah Opferman has won the 2024 Inspiring Impact award. “Our winners this year are not only savvy and respected businesswomen — but bold changemakers in the field, igniting inspiration and pride in everyone around them to excel in all their endeavors,” stated ACG Detroit Women’s Forum co-chair Carrie Schochet.

NFL Considers 30% Sale to PE Buyers. The NFL is reportedly considering a move that would allow a sale of up to 30% of the league to private equity investors, according to NBC Sports reports. The most that any single investor could own of one NFL team would be 10%; private equity firms may be able to hold stakes in multiple teams, reports needed. The proposal is not final, however, and it is unclear when the league would establish the policy.

PNC, TCW Collaborate on Private Credit. The PNC Financial Services Group and global asset manager TCW Group announced this week they are collaborating on delivering private credit to middle-market businesses, according to a press release. The two firms have been in partnership for more than 15 years, with TCW wielding its experience in originating, underwriting and managing direct lending portfolios, and PNC offering its widespread client base. The partnership will focus on asset-based loans for sponsored and non-sponsored midmarket companies.

Goldman Sachs Raising $17 Billion for Private Credit Investments. Goldman Sachs Merchant Banking Division is reportedly looking to raise up to $17 billion across two funds for private credit investments, according to Yahoo News reports. The firm is raising $7 billion for its Broad Street Loan Partners IV fund, which will invest in senior loan deals in the upper-middle market, and smaller deals in the broadly syndicated loan market. The firm is also raising between $5 billion and $10 billion for its West Street Strategic Solutions I, a special situations fund.

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.