HCI Equity Partners Announces Fund V Closing

Washington, D.C., November 2017

HCI Equity Partners (HCI), a private equity firm that targets growth oriented industrial product and service companies in the lower middle market, recently announced the closing of HCI Equity Partners Fund V. The fund exceeded its target of $400 million in less than a year of highly targeted marketing.

“HCI is pleased to further diversify our investor base and align with long term Limited Partners supportive of HCI’s operationally intensive approach to investing” commented Dan Dickinson, Co-Founder and Managing Partner at HCI. “We’re thankful for the confidence our investors have placed in HCI to continue our active approach to building solid partnerships with owners and management teams.”

The fund will execute HCI’s long-standing strategy of making control investments in lower middle market North American industrial product and service companies, in sectors including aerospace and defense, transportation products and services, distribution, infrastructure products and services and niche manufacturing and industrial services companies. HCI employs a focused investment strategy of partnering with companies with strong market positions, solid growth prospects, and ambitious owners and managers that can benefit from HCI’s operational focus, leadership, and hands-on approach. The Fund will be activated in January 2018.

UBS served as the placement agent and Kirkland & Ellis served as legal counsel to HCI Equity Partners.

Cumming, GA, October 2017

HCI Equity Partners is pleased to announce that existing portfolio company, The Delaney Hardware Company, completed the acquisition of Premier Products, Inc. on October 31, 2017. Premier is a manufacturer of hollow metal doors and frames for the commercial and multi-family construction industry and currently serves as Delaney’s primary supplier for hollow metal doors. The Company is headquartered in Monroe, Louisiana with additional locations in Atlanta and Houston.

Delaney, an existing HCI IV portfolio company based outside of Atlanta, Georgia, is a designer, marketer and distributor of residential and commercial locksets. The Company sources product through Asian manufacturing relationships and markets under its own Delaney and Callan brand names. Delaney’s customer base is largely composed of small-to-medium sized building products suppliers, installers and DIY outlets.

The combination of the Premier door and frame manufacturing and the breadth of the Delaney hardware offering will allow Delaney to increase their overall competitiveness in the commercial marketplace. Premier’s facility in Houston also provides a Western US presence for the Delaney business. We, along with management, believe that the combined strengths of Delaney and Premier will allow them to have a more competitive product offering that should enhance the current commercial business.

Auburn Hills, MI, August 2017

HCI Equity Partners is pleased to announce its acquisition of TSM Corporation, a leading precision machining company serving the automotive industry with over 70 SKU’s across 40 diverse and attractive vehicle platforms. TSM is a distinguished supplier of powertrain, chassis and suspension components.

Cleveland, OH, December 2016

HCI Equity Partners is pleased to announce the successful sale of Total Container Group (“TCG” or the “Company”) to National Container Group (“NCG”) on December 2, 2016. National Container Group is one of the largest reconditioners of plastic intermediate bulk containers (“IBC’s”) in North America. NCG’s parent, Mauser Group, is one of the world’s largest manufacturers of new plastic IBC’s.

TCG was formed in 2014 shortly after K.P. McNamara Company (acquired by HCI in 2012) merged with RnR Industrial Services. In November 2015, TCG added CMO Enterprises to the platform. Today, TCG offers a comprehensive array of industrial container solutions–ranging from less than 1 gallon cans to 20,000 gallon storage tanks–but is primarily focused on the reconditioning and distribution of plastic and steel IBC’s.

Simultaneous with the acquisition of TCG, NCG also acquired Advantage IBC, a competitor primarily in the Texas market. HCI arranged, fully negotiated and diligenced this transaction as an add-on acquisition for TCG, which made the overall platform increasingly compelling to NCG given the additional scale and consolidation opportunities.

Charleston, SC, October 2016

HCI Equity Partners is pleased to announce the merger of Royal Paper Products (the “Company”) and existing portfolio company AmerCare. The merger was completed on October 18, 2016 and the new company is now known as AmerCareRoyal.

Headquartered outside of Philadelphia, Pennsylvania, Royal Paper is a leading importer and supplier of disposable products primarily for the food service, janitorial and hospitality industries. Royal Paper has developed strong, longstanding relationships with a customer base that encompasses every one of the top 20 major distributors in the U.S. The Company’s geographic footprint in the Northeast is complementary to AmerCare’s focus in the Southeast and Southwest. The AmerCareRoyal platform will have an increased and diversified product offering, expanded salesforce, diversified customer base, improved geographic coverage and increased shipping points, and improved manufacturing and supply chain efficiencies.

This is the second acquisition in the consolidation strategy. AmerCare acquired JRMI, a leading provider of disposable products located outside of Dallas, Texas on May 6, 2016. Together these brands create a trusted and reliable industry solution with over 120 years of experience. The combined platform will be led by an extremely experienced management team including Ty King, Jay Earley, Scott Milberg and Adam Milberg.

St. Louis, MO, May 2016

HCI Equity Partners is pleased to announce it successfully completed the sale of Herndon Aerospace & Defense to KLX, Inc. (NASDAQ: KLXI) on May 17, 2016. Herndon Aerospace & Defense was created after the merger of portfolio companies Herndon Products, Inc. and Polygon Aerospace, Inc.

Herndon Products, Inc., headquartered in St. Louis, Missouri, specializes in providing value added supply chain management solutions and third party logistics for consumable hardware utilized in military applications including fixed and rotary wing aircraft, wheeled and tracked vehicles, and sea vessels.

Polygon Aerospace, Inc, headquartered in Houston, Texas, is a leading provider of aircraft fasteners. Polygon provides studs, washers, clamps, hilocks, nuts, bolts, pins and collars, seals, screws, lead bonds, rivets, as well as bushings, rings, fittings, and bearings for the aerospace manufacturing and maintenance industry.

KLX is the world’s largest value added service provider of aerospace fasteners and consumables with revenues in excess of $1.5 billion.

Managing Partner Doug McCormick commented, “We were pleased to support the Herndon and Polygon teams to consummate four acquisitions creating a business of scale with significant capabilities across the entire aerospace and defense supply chain. This is a great example of the real value creation that occurs when private equity capital complements an exceptional team and sound acquisition strategy.”

Charleston, SC, May 2016

HCI Equity Partners is pleased to announce the merger of JRMI and existing portfolio company AmerCare, completed on May 6, 2016.

Headquartered outside of Dallas, Texas, JRMI is a leading provider of disposable products including cutlery, straws, gloves, point of sale products, napkins and other paper disposables for the foodservice and retail industries. JRMI’s product line includes over 1,200 CHOICE branded products and private label and custom printed products. The company sources its products from a network of manufacturing partners across Asia, Mexico and the U.S. and maintains strong customer relationships serving over 5,000 restaurants and over 500 distribution partners across North America.

AmerCare, an existing HCI IV portfolio company based in Charleston, South Carolina, is a leading supplier of high quality disposable gloves and other ancillary products. Sold through distributors, AmerCare’s glove products are used in the medical, janitorial and food service end markets, as well as a variety of other industries.

The combined strengths of AmerCare and JRMI will allow them to offer a more complete product line and greater efficiencies operating in three locations to service customers nationwide. This transaction is the first in a consolidation strategy within the disposable product supply chain serving the foodservice, jan/san and medical end markets. HCI Managing Partner Doug McCormick said, “We are pleased to support two exceptional management teams through this transaction and believe the consolidation will create value for all constituents”.

Washington, D.C., April 2016

HCI Equity Partners is pleased to announce the acquisitions of KCA Electronics and Marcel Electronics International (“MEI”), completed on April 1 and April 22, respectively.

Headquartered in Anaheim, California, KCA provides advanced technology, multi-layer rigid and flex printed circuit boards. The company primarily serves the aerospace and defense sector, providing director access to customers or through EMS customers that support the A&D market. MEI is located in Orange, California and manufactures complex, multi-layer printed circuit boards.

These two acquisitions are the first in a defense electronics supply chain consolidation strategy led by HCI Managing Partner Doug McCormick and CEO Shane Whiteside. HCI has partnered with Mr. Whiteside to execute this strategy and lead this combined entity. Mr. Whiteside has a longstanding relationship with HCI and Mr. McCormick through their previous work together during the formation of TTM Technologies, a leading global manufacturer of printed circuit boards. Mr. McCormick said, “Shane is an exceptional manager with a compelling vision for the combined company. We are excited to support his growth strategy with our capital and expertise to create value in an industry in need of another capable provider.”

Regarding the acquisitions and future consolidation efforts, Mr. Whiteside said, “The combination of KCA and MEI creates a solid platform with outstanding capabilities across a broad range of products, and through further capital investment and the capture of market synergies, the combined company is well positioned for growth”.

HCI and Mr. Whiteside are actively looking for additional acquisition targets within the printed circuit board industry.

Washington, D.C., March 2016

HCI Equity Partners is pleased to announce its acquisition of Adept Plastic Finishing, a premier supplier offering injection molding, chrome plating and painting services for plastic components. Adept has established itself as the preferred supplier in the chrome plating industry, serving select Tier-1 suppliers in the automotive and Class-8 truck end markets. The Company’s proprietary process technology within its chrome plating segment allows them to handle a wide array of products, ranging from heavy-duty class-8 truck grilles to high-touch automotive badges. Adept works in conjunction with HCI’s portfolio company, Tribar Manufacturing.