The Sterling Group (“Sterling”), a Houston based private equity investment firm, today announced that its affiliated investment fund, Sterling Group Partners III, L.P., has completed the acquisition of the Stackpole International (“Stackpole”) business from Gates Canada (a subsidiary of Pinafore Holdings PV). The acquisition is Sterling’s second investment in its third fund, an $820 million fund raised in 2010, and is the twentieth corporate carve-out in its twenty-nine year history.
The acquisition was financed with equity from Sterling Group Partners III, L.P., Current Capital LLC and several other co-investors. Senior debt financing was provided by RBC Capital Markets, BNP Paribas and UBS and mezzanine debt was provided by Hancock Capital Management, Fifth Street and Global Leveraged Capital.
Stackpole was founded in 1952 and was acquired by Gates in 2003. Headquartered in Ancaster, Ontario, Stackpole is a manufacturer and sole source supplier of highly-engineered oil pumps and powdered metal components to automotive original equipment manufacturers. Stackpole is a market leader in both oil pumps and powdered metals and has established a long-standing track record with fifty-five years of manufacturing expertise. Stackpole’s products are specified into powertrain (engine and transmission) platforms that have an average lifecycle of ten to fifteen years. These platforms underpin approximately 400+ vehicle nameplates. Stackpole currently has twelve manufacturing facilities and technical centers in North America, Europe, China and Korea.
“The entire management team is thrilled to partner with Sterling to return Stackpole to a standalone business. Over the next few years, our business will have the opportunity to expand in North America and significantly increase its presence in Europe and Asia. We feel that Sterling’s historical experience in effectively guiding the growth of manufacturing businesses such as ours, as well as their access to capital to support our growth needs, will be tremendous assets for our company,” said Peter Ballantyne, President and CEO of Stackpole.
Kent Wallace, a Partner of Sterling noted, “We are very excited to have the opportunity to work with Pete, the rest of the Stackpole management team and the employees to continue to expand the company’s global manufacturing platform. We are confident the company will continue to build on its outstanding reputation for consistently manufacturing and delivering critical components.”
About The Sterling Group, L.P.
Founded in 1982, The Sterling Group is a private equity investment firm that targets controlling interests in basic manufacturing, distribution and industrial services companies. Typical enterprise values of these companies range from $100 million to $500 million. Sterling has sponsored the buyout of 40 platform companies and numerous add-on acquisitions for a total transaction value of approximately $9.4 billion. Currently, Sterling has $1.3 billion of committed capital under management through three funds. Current portfolio companies include North American Energy Partners, CST Industries, Roofing Supply Group, Universal Fiber Systems, Velcon Filters, Express, B&G Crane and Saxco International. The Sterling Group has a proven track record with corporate carve-outs as half of its transactions over the last thirty years have been the purchases of businesses from large corporations.
For additional information, please contact:
The Sterling Group, L.P.
Franny McKay Jones