May 31, 2012
The Sterling Group, a middle market private equity firm based in Houston, Texas, today announced that they have finalized the sale of Roofing Supply Group, LLC (“RSG”) to funds managed by Clayton, Dubilier & Rice, LLC (“CD&R”). RSG is the fourth largest distributor of roofing supplies and related materials in the United States, with 59 locations in 24 states. Terms of the transaction were not disclosed.
RSG has grown significantly in recent years, driven by strategic and operational initiatives undertaken by The Sterling Group in partnership with management. Since Sterling acquired RSG from its founders in 2006, EBITDA increased by more than 50% despite a record decline in housing starts that has yet to rebound.
“The investment in RSG exemplifies Sterling’s investment philosophy and operational approach,” said Kevin Garland, a Partner at The Sterling Group. “For thirty years, Sterling has focused on partnering with management to drive strategic initiatives and grow businesses for all shareholders, regardless of market cycles. We have worked closely with management to make dramatic improvements to RSG’s procurement, sales, pricing and to expand the company’s network into strategic markets. The result has been what we believe to be outstanding financial performance in the face of difficult end market conditions.”
Mike Farrell, CEO of RSG, said, “RSG has always had an excellent culture and best in class customer service efforts, but it was the resources and partnership with the Sterling team that enabled us to achieve new levels of success with the business. We look forward to continued growth under our new ownership.”
RSG was a portfolio company of Sterling Group Partners II, a fund controlled by The Sterling Group, L.P.
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 41 platform companies and numerous add-on acquisitions for a total transaction value of approximately $9.5 billion. Currently, Sterling has $1.2 billion of committed capital under management. Current portfolio companies include North American Energy Partners, CST Industries, Universal Fiber Systems, Velcon Filters, Express, B&G Crane Service, Saxco International, Stackpole International and Liqui-Box.
About Roofing Supply Group
Founded in 1981 and based in Dallas, TX, Roofing Supply Group is one of the largest wholesale distributors of roofing supplies and related materials in the United States. Through its network of 59 branches in 24 states, RSG provides one-step distribution services from roofing product manufacturers to roofing contractors and homebuilders. Each branch carries a complete line of roofing products for residential and commercial roofing, including composition asphalt shingles, underlayment, and associated ancillary products. For more information, please visit http://www.roofingsupplygroup.com.
Past performance is no guarantee of future results and all investments are subject to loss.
May 01, 2012
Velcon Filters, LLC, a manufacturer of industrial filtration systems, today announced that it has acquired Warner Lewis GmbH. Velcon is a portfolio company of The Sterling Group, a middle market private equity firm based in Houston, Texas, and was acquired in 2009 as a platform to execute a buy-and-build strategy.
Headquartered in Kelsterbach, Germany with locations in Phillipsburg, Germany; Farnborough, UK; Paris, France; and Dubai, UAE; Warner Lewis offers aircraft refueling solutions to customers in Europe, the Middle East and Africa (“EMEA”). Warner Lewis has been a strategic business partner of Velcon for over 40 years distributing Velcon’s line of products, in addition to manufacturing its own standard or custom vessels, pit-boxes and ground fueling products. The acquisition of Warner Lewis represents an opportunity for Velcon to directly serve customers in EMEA.
Velcon manufactures filtration systems, primarily for the jet fuel market, including vessels and replacement cartridges which meet specific requirements for fluid filtration processes in a variety of domestic and international end-markets. Keith McAslan, President of Velcon said, “Since 1969, Warner Lewis has been the recognized leader for aircraft fueling components and solutions in EMEA and has been Velcon’s exclusive distributor in that region. As Velcon looks toward its 60th anniversary in 2013, we are pleased to join with Warner Lewis and directly provide a broader range of products and solutions to our aviation customers in the Americas and EMEA.”
This is the third acquisition for Velcon in the past three years. Velcon acquired Chemflo in late 2009 to expand its product offering into the energy markets, and in 2010 acquired Twin Filter B.V. in the Netherlands to diversify and grow its business in the oil, liquid and air filtration markets. “We are excited to expand in the aviation fuel market where Velcon is a market leader in filtration and Warner Lewis is a trusted provider of filtration and refueling solutions,” Greg Elliott, Partner of The Sterling Group and Chairman of the Board of Velcon said. “Velcon’s acquisitions over the past three years have strengthened the global footprint, scale and organic growth opportunities of the business, and we expect that Warner Lewis will have a significant impact as well.” The acquisition was financed with debt from BNP Paribas, Amegy Bank of Texas and BBVA Compass.
About Velcon Filters, LLC
Velcon Filters, LLC, headquartered in Colorado Springs, Colorado, is a niche manufacturer of filtration systems, including vessels and replacement cartridges, that meet specific requirements for fluid filtration processes in a variety of domestic and international end-markets. The company’s aviation division, through Velcon branded product lines, is a global leader in the filtration process for aviation fuel delivery, engineering and manufacturing products that filter, purify and remove water and containments from aviation fuel along the transport chain from the refinery to the aircraft. Velcon’s process division, through its Twin Filter brand, engineers, manufactures and markets equipment and replacement cartridges for the oil, liquid and air filtration markets in Europe, Asia, North America and other international markets.
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 41 platform companies and numerous add-on acquisitions for a total transaction value of approximately $9.5 billion. Currently, Sterling has $1.2 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 Service, Saxco International, Stackpole International and Liqui-Box.
Franny Jones
713.341.5756
fjones@sterling-group.com
www.sterling-group.com
The Sterling Group is an operationally focused middle market private equity firm that builds winning businesses for customers, employees and investors.
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