Cleveland Business Pulse: M&A market bolsters confidence in 2013

Early signs, notably positive economic indicators and rising corporate earnings, point to an M&A market poised for strong deal flow in 2013. Sustained improvement in these trends will bolster confidence and bring more buyers and sellers to market. Buyer cash reserves and an accommodative credit market should lend further support.

January deal volume was light, down nearly 20 percent from a year ago, but not atypical of a seasonally slow month for M&A. Behind the numbers are several billion-dollar-plus deals, including ConAgra’s $6.7 billion acquisition of RalCorp Holdings. Other mega deals announced in recent weeks were Liberty Global’s pending $24 billion acquisition of Virgin Media, Reliance Steel’s $1.2 billion acquisition of Metals USA, and Dell’s $22 billion take-private by Silver Lake Partners, marking the largest LBO since 2007. These are strong signals that buyer confidence is returning and likely harbingers of more M&A activity on the horizon.

Local corporate buyers are on the hunt for deals. Timken Co. acquired Denver-based Wazee Companies LLC, a $30 million provider of motor, generator, wind and industrial crane services to the aerospace, mining, power generation, and oil and gas markets. Lincoln Electric Holdings Inc. acquired Tennessee Rand Inc., a $35 million manufacturer of tooling and robotic systems for welding applications in Tennessee, complementing its purchase of Wayne Trail Technologies last May. CBIZ Inc. purchased Diversified Industries Inc., a Minnesota company that provides payroll and human resource solutions to small and midsized businesses nationwide, making it its ninth acquisition in the last 12 months.

Notable private equity activity includes five deals from The Riverside Co., including Operating Tax Systems, which provides driver and vehicle compliance services primarily for the commercial motor vehicle industry. Other buys include Austin, Texas-based Alchemy Systems LP; Houston-based Jacosoft LLC; Bohemia Interactive Simulations s.r.o. of Australia, and GiveAnything.com Inc., a N.Y.-based company.

 

Deal of the Month

 

Global environmental consulting, engineering and technical services company Tetra Tech Inc. acquired American Environmental Group Ltd. of Richfield, a provider of specialty environmental, design, construction and maintenance services to solid and hazardous waste, environmental, energy and industrial clients. Founded in 2002, AEG employs 500 with annual revenue of approximately $95 million. Tetra Tech adds an East Coast presence with AEG, complementing its comparable legacy operations in Southern California, enhancing its ability to assist landfill operators, mining and power clients with disposal challenges.

AEG is Tetra Tech’s fifth acquisition announced in the last 12 months. Including AEG, the company completed two acquisitions in the U.S., two in Brazil and one in Canada. Tetra Tech employs 13,000 people worldwide and reported sales of $2.0 billion in fiscal year 2012.

Andrew K. Petryk is managing director and principal of Brown Gibbons Lang & Co. LLC, an investment bank serving the middle market. Contact him at (216) 920-6613 or [email protected]

Cleveland Pulse; 2012 goes out with some big deals

Albert D. Melchiorre, President, MelCap Partners, LLC

The last month of the year has historically been a prolific month for mergers and acquisitions, and December 2012 did not disappoint.

In the U.S. market, according to S&P CapitalIQ, the dollar value of closed transactions with disclosed values for December 2012, compared to December 2011, was up 4.4 percent, while the number of transactions was down 6.5 percent.

Likewise, for all of 2012, the number of transactions decreased 4.4 percent compared to 2011.  The transaction dollar values made up for the lack of volume with an increase of 7.8 percent across the same period.

Regarding the M&A industry, the purchasing power of private equity groups has been on a steady decline since 2007 as they seek to put money to work, while strategic purchasing power continues to climb. Conversely, private equity partnership commitments to all types of funds, according to Dow Jones, are up 30 percent from last year.

With respect to corporate buyers, Applied Industrial Technologies acquired Parts Associates Inc. of Cleveland. The distributor of maintenance supplies and solutions, including fasteners, fluid flow, chemicals and shop supplies has two locations, Cleveland and Atlanta, staffing an estimated 200 employees.

Gulfport Energy Corp. dug up $372 million to purchase 37,000 acres from Windsor, Ohio, in the Utica Shale region. This purchase increases Gulfport’s interests in the Utica Shale region to 137,000 acres.

DDR Corp. acquired two shopping centers for $151 million in December. This brings DDR’s total acquisitions in 2012 to $2.1 billion. First Communications Inc. in Akron sold subsidiary First Telecom Services for an electrifying $110 million to the Zayo Group. First Telecom Services is a provider of bandwidth infrastructure services.

With respect to private-equity-related transactions, Linsalata Capital Partners Inc. acquired Stag-Parkway Inc. from Ares Capital Corp. Stag is the largest aftermarket distributor of recreational vehicle parts and accessories in North America and is based in Atlanta. The Weinberg Capital Group, in conjunction with the The Riverside Co. and Hicks Equity Partners, acquired Overton Chicago Gear Corp., a manufacturer and distributor of large-diameter precision gears.

 

ALBERT D. MELCHIORRE is the president of MelCap Partners LLC, a middle-market investment banking firm. He is also a director on the ACG Cleveland board. For more information on MelCap Partners, please visit www.melcap.co.  For more information about the Association for Corporate Growth, please visit www.acg.org/cleveland.

 

Deal of the Month

This month, the honor goes to the Cleveland Indians for the sale of SportsTime Ohio to News Corp.’s Fox Sports Media Group for $230 million. This acquisition is part of a push by media and entertainment companies that target regional sports channels, since broadcast rights for professional sports events are locked in for years. Fox Sports Ohio serves more than 5 million homes throughout the Midwest and is the exclusive regional TV home of the Cincinnati Reds, Cleveland Cavaliers, Columbus Blue Jackets, Columbus Crew, Xavier Musketeers and Cincinnati Bearcats.

“The acquisition of Sports Time Ohio solidifies our business in Ohio, and Fox Sports Media Group’s new long-term agreement with the Indians reunites the team with the Fox Sports family,” said Jeff Krolik, executive vice president of Fox Sports Networks. “We look forward to once again showcasing the Indians to their fans, as well as working with the Indians ownership to continue to enhance the value of this iconic franchise.”

Movers and Shakers Cleveland February 2013

Jeanne Cowart, Client Manager, Creekside Financial Advisors LLC

Cleveland-based Creekside Financial Advisors LLC has announced that Jeanne Cowart joined the financial services firm as a client manager supporting Alan Yanowitz, J.D., a Creekside financial adviser.

Cowart’s strong analytical skills combined with her deep client-service experience makes her the ideal candidate to work with clients on a day-to-day basis and provide them with the data and information they want, in a manner that suits their particular needs.

Cowart comes to Creekside after serving in client management roles at Edward Jones and AmTrust Bank. At Edward Jones, she was responsible for managing the operations of the office and, most importantly, delivering a consistently exceptional client experience. She wore many hats and was the first line of contact for the entire firm’s clients.

 

 

Traci Fabrizi, Vice President and Corporate Controller, Medical Mutual

Alliance Solutions Group, a full-service staffing and recruitment agency, has recently expanded its presence to Lake County by opening a new staffing facility at 8334 Mentor Avenue in Mentor, Ohio.

This new office will offer recruitment and staffing services from the company’s nine business units to individuals in Mentor, Painesville, Willoughby, and the surrounding communities. The Mentor office is the fifth new or expanded office that Alliance Solutions Group has opened in the past year, with earlier expansions taking place in Mahoning Valley, Akron, Elyria and Upper Sandusky, Ohio.

Alliance Solutions Group serves the broadest scope of industries among any staffing recruitment agency in Northeast Ohio, giving its customers single-source convenience across multiple specialties.

 

 

Medical Mutual has recently announced several new appointments here in Cleveland — the health insurer has appointed Traci Fabrizi as vice president and corporate controller, Ann Vickers as senior marketing director, Gregory Young as director of strategic initiatives, and welcomes back Debra Green after a year and a half as the director of community

Anne Vickers, Senior Marketing Director, Medical Mutual

outreach.

 

Traci Fabrizi will be responsible for the overall direction of various divisions including corporate financial reporting and forecasting, cost accounting and budget, cashiers, collections, corporate taxation, payroll, self-funded billing, broker administration, and financial analysis. She will also have responsibilities for the Life Group accounting and analysis for the company’s life insurance subsidiary.

With an extensive background in the health insurance industry, Fabrizi’s most recent role was vice president of finance and network at WellCare of Ohio. She also served as the vice president of finance and controller for QualChoice.

 

 

Gregory Young, Director of Strategic Initiatives, Medical Mutual

Ann Vickers is taking on additional responsibilities in her new position leading the marketing, advertising and corporate identity areas, which provide marketing and communications support to help Medical Mutual meet sales objectives.

Vickers’ new responsibilities include managing the sales and broker special events function, along with coordinating all purchased promotional items across sales and corporate communications. She has also assumed responsibility of the Consumer Advisory Council, and will work to refocus its objectives to better support Medical Mutual’s changing business and the needs of its customers.

Vickers joined the company in 2009 as marketing communications director. Prior to joining Medical Mutual, she was director of marketing and communications for MemberHealth LLC and director of communications for Delphi Packard Electric.

 

 

Gregory Young will be responsible for identifying and addressing strategic challenges and opportunities brought about by the quickly evolving health insurance industry. He will also be responsible for monitoring emerging trends and evaluating the impact on the company, and on the marketplace as a whole.

Debra Green, Director of Community Outreach, Medical Mutual

As he has done in his previous role as manager of government relations, Young will continue making presentations about the Affordable Care Act to various internal and external audiences with a focus on the company’s strategic initiatives.

Young joined the company in 2008 and served as government relations senior analyst before being promoted to manager in 2011.

 

 

Debra Green rejoins Medical Mutual from the Cleveland Clinic where she served as director of community outreach for the Taussig Cancer Institute. At Medical Mutual, Green will be responsible for developing and executing all community outreach programs and will serve as principal corporate representative in community affairs.

Green began her career with Medical Mutual in 1984 serving in customer service as a generalist in human resources, and later joined corporate communications as senior community relations specialist. She was named manager of community relations within a year of joining the department.

Movers and Shakers January 2013

Lisa Habe, Chairman of the Board of Directors, Interlake Industries Inc.

Magnus International Group announced that its founder, Eric Lofquist, has been named the Ernst & Young National Entrepreneur Of The Year 2012 Distribution and Manufacturing Category Award winner.

The Ernst & Young Entrepreneur Of The Year Award is the country’s most prestigious business award for entrepreneurs. The award encourages entrepreneurial activity and recognizes leaders and visionaries who demonstrate innovation, financial success and personal commitment as they create and build world-class businesses.

 

Alliance Solutions Group, a full-service staffing and recruitment agency with offices in Cuyahoga, Summit, Portage, Franklin, Lorain, Mahoning, Lake and Wyandot counties, appointed Mark D’Agostino as president of Alliance Solutions Group of Akron. D’Agostino is opening a new staffing “hub” facility in Akron that offers the company’s full complement of staffing and recruitment services from all nine of its business units. Previously, Alliance Solutions Group operated a smaller office in Akron that only served the manufacturing and warehouse industries

Mark D’Agostino, President, Alliance Solutions Group of Akron

 

Medical Mutual recently announced that Kathy Golovan has been appointed executive vice president and chief information officer. Golovan will be responsible for the information technology division including IT infrastructure and development.

Before joining Medical Mutual, Golovan was a tax consulting manager at Ernst & Young. She joined Medical Mutual in 1998 as a tax coordinator. In 1999, she moved from finance to legal.

 

Kaiser Permanente Ohio recently announced that Dr. Nabil Chehade has been named the next president and executive medical director of the Ohio Permanente Medical Group (OPMG), the exclusive physician network for Kaiser Permanente members.

Dr. Chehade began his new role Jan. 1 and will lead more than 200 health care clinicians and professionals who work for OPMG in 15 Kaiser Permanente medical offices in Northeast Ohio.

 

Mark Duluk, Senior Design Architect, C.C. Hodgson

C.C. Hodgson recently announced the addition of two architects, Mark Duluk, senior design architect, and George Gatta, design architect/project manager.

Duluk is a graduate of Harvard University and has more than 20 years of experience in master planning and design.

Gatta returns back to working with Hodgson where he had previously worked on the master planning and designing of several senior living campuses.

 

Interlake Industries Inc. announced that Lisa M. Habe has been appointed chairman of the board of directors. The corporation specializes in short- to medium-run metal stampings with facilities in Ohio and Florida.

 

George Gatta, Design Architect / Project Manager, C.C. Hodgson

Western Reserve Partners announced that David P. Mariano has rejoined the firm as a director. Mariano will focus exclusively on building Western Reserve’s buy-side advisory practice. ●

January Cleveland Pulse – Gearing up for an unforgettable 2013

Albert D. Melchiorre, President, MelCap Partners, LLC

Domestic mergers and acquisitions decreased 28 percent from October to November, according to S&P Capital IQ, but the transaction values made up for the lack of volume by increasing 21 percent across the same period.

The strong purchasing power capabilities of both financial and strategic buyers, aging baby boomers needing to transition their businesses, and financials needing to exit aging portfolio companies are positive signs for the M&A market. Despite these factors, the future seems as murky as ever.

The fiscal cliff is rapidly approaching and we may have already taken the proverbial plunge before you even read this story.

Regarding corporate buyers, Lincoln Electric Co. snatched up three businesses from ITT Corp. near Charleston, S.C. Applied Industrial Technologies Inc. acquired HyQuip Inc., a 19-employee company that is a distributor of hydraulic, rubber and plastic industrial hose and tubing. Nordson Corp. purchased certain assets of Kodama Chemical Industry Co. Ltd., a licensed distributor for Nordson’s EDI business in Japan. Nordson acquired EDI last June.

Cedar Fair LP, which owns the Cedar Point amusement park, sold Knott’s Soak City in California to SeaWorld. It will become SeaWorld’s third aquatic park in the United States.

Eaton Corp. completed the acquisition of the electrical equipment supplier Cooper Industries plc for $13 billion.

The Riverside Co. made a total of four acquisitions in November. It acquired Digital University, which is the sixth add-on since 2007 to OnCourse Learning. Riverside also purchased Learning Seat, an Australian-based provider of e-learning courses. The other two companies are in the transportation and health care industries.

Finally, Sherwin-Williams Co. announced plans to acquire Mexican competitor COMEX for $2.4 billion.

 

ALBERT D. MELCHIORRE is the president of MelCap Partners LLC, a middle-market investment banking firm. He is also a director on the ACG Cleveland board. For more information on MelCap Partners, please visit www.melcap.co. For more information about the Association for Corporate Growth, please visit www.acg.org/cleveland.

 

Deal of the Month

Parker Hannifin Corp. is going out with a bang in 2012 as it completed two acquisitions with combined sales of $215 million in November, earning them the Deal of the Month award.

The first acquisition was Velcon Filters from the private equity firm, The Sterling Group.

Velcon is a niche manufacturer of filtration systems with 300 employees.

Parker’s second purchase was Houston-based PGI International. PGI is manufacturer of specialized, high-pressure flow control components and systems.

PGI has 550 employees and approximate sales of $100 million. This marks Parker’s 13th M&A transaction in 2012. The company has increased its annual dividends paid to shareholders for 56 consecutive fiscal years, among the top five longest running dividend increase records in the S&P 500 index.

Cleveland Pulse – October treats may lead to tricks in 2013

Albert D. Melchiorre, President, MelCap Partners, LLC

Domestic transactions in October increased 9 percent when compared to the previous month and the value of those deals increased 93 percent when compared to September, according to S&P CapitalIQ. This is a positive sign for the market, but it may not continue.

With the current tax hikes effective in 2013, the upcoming year could be a rocky road.  Of course, with trillions in cash and purchasing power available to both strategic corporate buyers and private equity groups, the unhealthy tax hikes may be counterbalanced with a need for higher yields, distribution of funds and accretive earnings.

On the private equity side, The Riverside Co. completed both an acquisition and an exit. Riverside’s portfolio company, SMS, completed the acquisition of a west coast respiratory equipment company in Premier Medical Corp. Riverside also sold Coeur Holding Co. to Illinois Tool Works.

Resilience Capital Partners completed two acquisitions, the first being the acquisition of CR Brands, a manufacturer of household cleaning and laundry products. Later in the month, Resilience acquired Advanced Communications Inc. through Aero Communications. Advanced Communications is a provider of telecom infrastructure services. Other notable private equity transactions for the month include Blue Point Capital Partners’ acquisition of California-based Smith-Cooper International, a producer and distributor of pipe, valves and fittings, and Morgenthaler’s sale of Avtron Industrial Automation Inc. to Japan’s Nidec Corp.

With respect to corporate buyers, both Steris Corp. and Parker Hannifin Corp. were very acquisitive in October. Steris closed two deals on Oct. 16 totaling $110 million. The businesses, Spectrum Surgical Instruments and Total Repair Express, are leading providers of surgical instrument repair services with combined revenues of approximately $72 million. Parker Hannifin also announced it would acquire two companies during the month and divest the automotive air conditioning portion of its Mobile Climate Systems Division to Germany’s ContiTech.

ALBERT D. MELCHIORRE is the president of MelCap Partners LLC, a middle-market investment banking firm. He is also a director on the ACG Cleveland board. For more information on MelCap Partners, please visit www.melcap.co. For more information about the Association for Corporate Growth, please visit www.acg.org/cleveland.

 

Deal of the Month

The deal of the month is awarded to our beloved Cleveland Browns and new team owner Jimmy Haslam III. Randy Lerner, the previous controlling owner of the Browns, agreed to sell the team to Haslam at the beginning of training camp in August. The deal closed on Oct. 25 for $1.05 billion after the NFL owners voted in favor of the transaction 32-0. Approximately $700 million for the team was paid current, giving Haslam 70 percent ownership of the team. The other 30 percent will be purchased in four years by Pilot Flying J for more than $300 million. After the return of the Browns to Cleveland in 1999, the team has only made the playoffs once, a trend that will continue this season. Hopefully, Haslam can add value to his $1 billion investment and bring a Super Bowl to the city of Cleveland — or at least wins against the Ravens and the team Haslam was previously involved with, the Steelers.

 

Deals continue to happen as autumn takes hold

Albert D. Melchiorre, President, MelCap Partners, LLC

The conditions seem ripe for business activity as fundraising remains strong and recent sales of portfolio companies have bolstered buying power. Buyers, however, are still cautious of putting too much capital to work in any one deal since deals under $50 million now represent over half of all deal flow, according to Pitchbook

Despite the restraint nationwide, local M&A deals continue to get done.

Eaton Corp. completed the acquisition of Rolec Comercial e Industrial S.A. in Santiago, Chile, and RPM International Inc. acquired Kirker Enterprises Inc.

The Riverside Co. remained active in its technology and health care platforms in September by selling HEALTHCAREfirst in Ozark, Mo., to Pamlico Capital after quadrupling its revenue in four years with the help of two add-on acquisitions. Riverside’s portfolio company, OnCourse Learning Co., acquired CompuTaught, a provider of online training courses and print resources for real estate professionals. Riverside also purchased Future Medical Inc., a provider of rental respiratory equipment.

Cyprium Investment Partners LLC exited Convergint Technologies LLC based in Schaumburg, Ill. KRG Capital Partners helped in a recapitalization with Convergint’s senior management team. Morgenthaler unloaded Avtron Industrial Automation to Nidec Corp., a Japanese strategic buyer. Independence-based Avtron has 154 employees and generated sales of $33 million last year.

American Greetings Corp. is being taken private through the efforts and money of the CEO Zev Weiss and President and COO Jeffrey Weiss, respectively, on behalf of the Weiss family and related parties. The offer is 20 percent greater than the current Class A common shares as of Sept. 25. American Greetings has been a publicly traded company since 1958.

Finally, Akron-based FirstMerit Bank announced its agreement to purchase Citizens Republic Bancorp in a stock deal valued at approximately $952 million. This will expand FirstMerit’s presence in Michigan and Wisconsin. <<

Albert D. Melchiorreis the president of MelCap Partners LLC, a middle-market investment banking firm. He is also a director on the ACG Cleveland board. For more information on MelCap Partners, please visit www.melcap.co. For more information about the Association for Corporate Growth, please visit www.acg.org/cleveland.

 

Deal of the month

This month’s award goes to TransDigm Group Inc., which continued its M&A aerial attack by acquiring Aero-Instruments Co. LLC from the locally owned private equity company The Mifsud Group. Aero-instruments has been a supplier of proprietary and highly engineered components to the aerospace industry since 1925. It has components on tens of thousands of aircraft globally. More than 60 percent of Aero’s revenue comes from the aftermarket, whereas military revenues make up about 20 percent of the total revenue. Aero was purchased by The Mifsud Group in August 2001. It was bought for about $35 million in cash and employs about 60 people. This is Transdigm’s fourth acquisition in the last 13 months. Transdigm currently operates out of 23 business groups, with 3,800 employees. More than 90 percent of Transdigm’s sales are derived from proprietary products to which it owns the design.

Movers and Shakers: November 2012

Ray Mueller, Executive Vice President and CFO, Medical Mutual

Medical Mutual has announced that Ray Mueller has been named executive vice president and CFO. Mueller will be responsible for the company’s finance, treasury, facilities and administration and human resources departments.

Prior to this position, in January 2010, he was appointed the company’s vice president of finance and corporate controller. Mueller was promoted again in January 2012 to senior vice president of finance and corporate controller. Mueller originally joined Medical Mutual in 1986 as a senior financial analyst in the Western Division based in Toledo.

 

Medical Mutual has also announced that Carol Bushnell has been appointed to vice president, underwriting and chief underwriter. Bushnell will be responsible for core underwriting functions. She will also be in charge of product management.

She joined Medical Mutual in 1987, as supervisor of quality assurance in the internal performance department. After working in large group underwriting, she became manager of underwriting policy in 2003, a position she held for three years until becoming director of underwriting administration. Bushnell was promoted to senior director of large group underwriting, her most recent position, in 2010.

Carol Bushnell, Vice President, Underwriting and Chief Underwriter, Medical Mutual

 

Bruner-Cox LLP recently announced the following promotions:

Jeffrey S. Buckshaw has been promoted to assurance services senior manager. Buckshaw joined Bruner-Cox LLP in 2001. He has more than 10 years of experience providing accounting, auditing and corporate and individual tax services to clients in the manufacturing, real estate and not-for-profit industries.

Matthew L. Douglas has been promoted to tax senior associate. Douglas joined Bruner-Cox LLP in 2011. He has experience in corporate and individual taxation. Douglas provides services to clients in the manufacturing, wholesale-distribution, construction and real estate industries.

Laura A. King has been promoted to tax senior manager. King joined Bruner-Cox LLP in 2003. She has more than 13 years of consulting and taxation experience. King handles personal and corporate taxation with an extensive expertise serving middle-market corporations in the manufacturing and wholesale-distribution industries. King also specializes in expatriate tax matters, assisting

Jeffrey Buckshaw, Assurance Services Senior Manager, Bruner-Cox LLP

international clients with tax planning and compliance.

Michele M. Monter has been promoted to assurance services director. Monter joined Bruner-Cox LLP in 1989. She has more than 20 years of public accounting experience, providing services for construction and manufacturing clients.

 

Alliance Solutions Group, a full-service staffing and recruitment agency, has recently expanded its Akron presence by opening a new staffing “hub” facility at 3250 West Market Street, Suite 103, in Akron. This office will offer the company’s full complement of staffing and recruitment services from all nine of its business units.

The Akron office is the third new or expanded office that Alliance Solutions Group has opened in the past year, with earlier expansions taking place in Elyria and Upper Sandusky. Alliance Solutions Group remains on a fast-growth track with 32 percent growth last year — a figure that is three times the national average for staffing companies.

Laura King, Tax Senior Manager, Bruner-Cox LLP

 

Bober Markey Fedorovich, a regional audit, accounting and business advisory firm with offices in Akron and Cleveland, recently promoted six of its associates to new positions within the firm.

Chad Basquin has been promoted to manager, accounting and auditing department. Jeanine Black has been promoted to supervisor, marketing and public relations. Jessica Tepus has been promoted to supervisor, tax department. Shawn Carlson has been promoted to supervisor, accounting and auditing department. Mindy Marsden has been promoted to supervisor, valuation and transaction services. And Kristopher Brown has been promoted to senior accountant, accounting and auditing department.

 

Spectrum Surgical Instruments Corp. has announced the appointment of Jim Hoffman to vice president of endoscopy and field operations. Hoffman’s long history of 20 years in the industry

Michele Monter, Assurance Services Director, Bruner-Cox LLP

started with the implementation of on-location surgical instrument repair services. He managed sales efforts throughout the Western United States and was directly responsible for repair service quality standards. His experience with group purchasing organizations, educational programs and direct sales was instrumental in growing the business to a national level. <<

Please send your executive-level promotions to [email protected]

October Cleveland Deals Page

Albert D. Melchiorre, President, MelCap Partners, LLC

There are no statistical indications that private equity groups are making a concerted effort to buy companies as the number of deals closed by PEGs in the first half of 2012 was approximately 650. This is considerably lower than last year’s total closings of 1,893, according to Pitchbook. Furthermore, the dollar value of invested capital by PEGs in the first two quarters of 2012 was the worst since the fourth quarter of 2009. Yet despite all of that, fundraising is showing better results in the first half of 2012 than it has over the same time period in the last three years.

Regarding the domestic M&A market, the number of closed transactions through July and August is on pace to be down 9 percent from the second quarter of the year and down 13 percent from the first quarter. Domestic M&A transaction dollar values are also on pace to be down 9 percent from this year’s second quarter and slightly down from the quarterly average since the beginning of 2010.

Despite the reduced investment activity of private equity groups, local strategic buyers put cash to use this month with the following acquisitions: Nordson Corp. acquired Sealant Equipment & Engineering Inc.; Parker Hannifin Corp. purchased SciLog Inc.; Applied Industrial Technologies Inc. acquired SKF Bearing Supplies and SKF New Zealand; and Aleris Corp. purchased a German company. 

As for local private equity groups, Linsalata Capital Partners completed the sale of Stanton Carpet Corp. The Riverside Co. exited its eighth company this year by selling Health & Safety Institute. Riverside also purchased the U.S. food ingredients distribution business of Centerchem and bought Orthodontic Design and Production in Vista, Calif. 

Supply Chain Equity Partners acquired a majority stake in Storage Battery Systems Inc., a specialty distributor of battery-backed critical power products based in Milwaukee. Evolution Capital Partners purchased Lewellyn Technology in Linton, Ind.

With respect to Northeast Ohio deal announcements, Eaton Corp. and A. Schulman Inc. announced acquisitions. Shearer’s Foods Inc. announced a sale to two private equity groups. TMW Systems Inc. announced its sale to Trimble Navigation Ltd. for $340 million. And finally, OrthoHelix Surgical Designs of Medina announced that it will be acquired by global medical device company Tornier N.V. for $135 million in cash and Tornier stock. <<

ALBERT D. MELCHIORRE is president of MelCap Partners LLC, a middle-market investment banking firm. He is also a director on the ACG Cleveland board. For more information on MelCap Partners, please visit www.melcap.co. For more information about the Association for Corporate Growth, please visit www.acg.org/cleveland.

Deal of the Month

Goldsmith & Eggleston Inc. of Wadsworth was sold to international company The Ravago Group through Ravago Holdings America. G&E was established in 1968 and operated as an employee-owned company. It manufactures and distributes reprocessed rubber raw materials and black masterbatch for a variety of diverse industries, mainly the global rubber industry. Included in the sale was Reliable Polymer Services, a reprocessing rubber facility in Port Arthur, Texas.

The combined revenue of G&E and Reliable Polymer Services is estimated to be under $90 million with an estimated 140 employees, according to Dun & Bradstreet. Ravago is a global leader in the distribution, resale and compounding of commodity, engineering and specialty plastic and rubber polymers. Ravago employs more than 4,500 people, controls more than 200 subsidiaries in 50 different countries and serves more than 40,000 customers. The Ravago Group is based in Brussels, Belgium.  <<

Movers and Shakers

Jason Jones, General Manager of Cleveland Office, Turner Construction

Turner Construction Co. has announced that  Jason Jones has been named general manager for the company’s Cleveland office. He most recently served as manager of Turner’s Special Projects Division in Cleveland.

Jones now leads all operations and business strategy for Turner’s Cleveland office. He replaces Mark Dent, who has accepted a position leading Turner’s offices in the Carolinas.

A native of the Cleveland area, Jones attended Cleveland State University, where he received an MBA in Finance, and the University of Akron. He has been with Turner for 15 years, serving in positions of increasing responsibility and working in a number of departments, including special projects, preconstruction, estimating, and engineering.

Buckingham, Doolittle & Burroughs LLP has announced that John F. Hill will join the firm’s Akron office in October as a partner in the firm’s Litigation Practice Group. He joins Buckingham from Hill Hardman LLC, where he was one of the principals.

John Hill, Partner in Litigation Pratice Group, Buckingham, Doolittle & Burroughs LLP

Hill brings a wide range of clients in complex commercial cases. His work has ranged from contract litigation to shareholder disputes, including national class action litigation. Hill has been consistently selected to The Best Lawyers in America, Ohio’s Super Lawyers and Ohio’s Super Lawyers “Top 100.” In addition, he was selected by his peers for inclusion in the 2008-11 editions of “Best Lawyers in America.” He was named the Best Lawyers “2010 Lawyer of the Year” in the area of “bet the company” litigation for the Akron area.

Buckingham, Doolittle & Burroughs LLP also announced that associates Justin S. Greenfelder, David J. Lindner, Michael J. Matasich and Dustin J. Vrabel have been promoted to partner. Greenfelder and Vrabel are based at the firm’s Canton office, while Lindner and Matasich are based in the Cleveland office.

“It is always a pleasure to be able to reward excellence, hard work and dedication,” says John Slagter, Buckingham’s managing partner. “Buckingham is committed to its region, and it is reassuring to note that Justin, David, Michael and Dustin are all Northeast Ohio natives who have chosen to continue to live and further their careers in our region. They are fully committed to Northeast Ohio and we are committed to them.”

Mark Ruth, Director of Resource Development, Big Brothers Big Sisters of Northeast Ohio

Big Brothers Big Sisters of Northeast Ohio announced that it has hired Mark R. Ruth as its director of resource development. Ruth will oversee all fund raising and volunteer based events and activities to help support the organization’s growth objectives.

Ruth can personally speak to the positive value and impact that Big Brothers Big Sisters has on children and their families due to his direct experiences with their services, both as youth and as an adult. After graduating from John Carroll University in 1978, Ruth became an active Big Brother himself. He has served as a board member for Big Brothers Big Sisters and now joins their professional staff to serve in this new capacity.

NAI Daus has announced it hired commercial real estate veteran and financial strategist, Suzanne Hamilton, as vice president of finance. Hamilton has more than two decades of experience and results analyzing business opportunities and developing valuations on commercial projects. 

Suzanne Hamilton, Vice President of Finance, NAI Daus

Hamilton will oversee evaluating prospective and existing project opportunities for investors and clients, analyzing a property’s financial performance and value. Key responsibilities include maximizing investment portfolios, evaluating funding solutions, and helping position the firm for its next level of business growth by maximizing deal performances.<<

Please send your executive-level promotions to [email protected]