July Cleveland Deals

Albert D. Melchiorre, President, MelCap Partners, LLC

While the wheeling and dealing continues at Cleveland’s new casino, the pace of activity on the business transactions front is a bit more sluggish. According to S&P CapitalIQ, the number of disclosed domestic M&A deal closings in May fell 6 percent and 29 percent, compared to April 2012 and May 2011, respectively. In Northeast Ohio, S&P CapitalIQ reported 18 closed deals in May, down from 19 in April 2012 and down from 23 in May 2011.

Globally, stock markets dropped 5 to 7 percent in the month of May. But in terms of deal value, May saw the highest totals it’s seen since October 2007. The trailing 12-month purchase price per domestic transaction as of May 2012, excluding extraneously large deals (typically those greater than $5 billion in deal value), was $112 million, according to S&P Capital IQ and MelCap Partners. The average purchase price for the month of May, excluding large transactions, was $131 million.

One of the biggest deals of the month locally was Eaton Corp.’s intention to purchase Cooper Industries plc for $11.8 billion. Cooper is a leading supplier of electrical equipment. The deal is expected to close in the second half of 2012 and combined revenues will be over $21 billion.

Things Remembered Inc., owned by GB Merchant Partners LLC and Bruckmann, Rosser, Sherrill & Co. L.L.C., was sold for $295 million to Chicago-based private equity firm Madison Dearborn Partners LLC. Things Remembered is headquartered in Highland Heights and employs more than 4,000 people.

The M&A markets are still poised for growth, despite the numbers showing a slight downtick from prior periods. There is still time left for a good showing in 2012 and plenty of seats open at the deal table.

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 a company that truly embodies the classic American dream of building a business and selling it. Watteredge Inc. has been in business for more than 60 years and has experienced rapid growth over the course of the last decade. On May 31, the company was sold to Coleman Cable Inc. Watteredge designs, manufactures and sells secondary power connectors, including electric arc furnace cables, resistance welding cables, industrial high-performance copper bus bars and other high performance devices and accessories.

“This acquisition immediately expands our product platform and allows us to provide an entirely new line of highly engineered industrial products across a number of end markets,” says Coleman’s CEO G. Gary Yetman.

The American dream is alive and well.

July Movers & Shakers

The Cleveland Clinic recently named Gordon Snow, a former FBI assistant director, as its new chief of protective services.

Snow, who has experience in national security, law enforcement and cyber security, began in his new position May 14. As chief of protective services, he will oversee five key functions reaching across the entire Cleveland Clinic enterprise: police and global security, transportation, parking, fleet management, and emergency preparedness.

He was a member of the FBI for 20 years, where he served in numerous leadership roles, including assistant director of the cyber division, director of the National Cyber Investigative Joint Task Force, FBI’s on-scene commander in the Afghanistan theater of operations, and chief of the weapons of mass destruction and acquisition of U.S. Nuclear & Missile Technology Unit.

Heather Thiltgen, vice president, direct to consumer strategy, Medical Mutual

Medical Mutual has announced Heather Thiltgen as vice president, direct to consumer strategy.

Thiltgen will be responsible for developing and implementing a direct-to-consumer strategy to attract and retain individual policyholders. She will focus on meeting the needs of consumers who are in the market for individual health insurance products.

Before joining Medical Mutual, Thiltgen served as vice president of consumer marketing for the CUNA Mutual Group. She also held a variety of positions throughout her 10 years in member acquisition, marketing and product management at USAA.

On June 13, the National Multiple Sclerosis Society honored Dr. Luis Proenza and Theresa Proenza during The 6th Annual Akron Dinner of Champions. The Proenzas received the Norman Cohn Hope Award, the National Multiple Sclerosis Society’s most prestigious award. They were honored for their dedicated commitment to community leadership and service. 

Dr. Proenza has served as the president of The University of Akron since 1999. Under his leadership, the university has become a powerful engine for regional economic development, a catalyst for collaborative initiatives and the preeminent public research university in Northeast Ohio. He spearheaded the physical transformation of the campus to enhance the college through the addition of 20 new facilities, 18 major renovations and 34 acres of new green space.

Dr. Proenza also led community efforts to create two key enterprises: a University Park Alliance that is revitalizing a 50-block area surrounding its campus and the $200 million Austen BioInnovation Institute in Akron, a partnership with three area hospitals and a medical school to establish Akron as a center for biomaterials and biomedicine.

Glenmede, a privately held and independent investment and wealth management firm, has announced the promotion of three key leaders within its Cleveland office. Linda Olejko, Tracy Jemison and Robert Siewert were all promoted to managing director.

These individuals provide investment and wealth management service for Glenmede’s clients in the Cleveland area, including ultra- and high-net-worth individuals and families, as well as foundations and endowments.

Combined, these three have been at Glenmede 23 years and have more than 65 years of industry experience. The company’s Cleveland office opened in 1997 and today serves more than 184 relationships.

Daniel Callanan, director, Western Reserve Valuation Services LLC

Western Reserve Partners LLC announced that Daniel P. Callanan has joined Western Reserve Valuation Services LLC as a director and shareholder. WRVS is an affiliate of WRP that provides valuation services and financial opinions relating to corporate finance transactions, corporate tax planning and compliance, succession planning and wealth preservation, employee stock ownership plans, financial reporting and portfolio/fund valuations.

Callanan is a seasoned valuation professional having advised privately held and publicly traded companies on valuation and other financial matters for nearly 20 years. Prior to joining WRVS, he served in a variety of valuation-related capacities at ComStock Advisors, JP Morgan/Chase, Willamette Management Associates and Arthur Andersen and Co.

Oswald Cos. — one of the largest independently owned insurance brokerages in the U.S. — has announced Steven J. Baltas as its new vice president and the acquisition of Union Insurance Group Inc.  

Steven Baltas, vice president, Oswald Cos.

The acquisition is in direct response to Oswald’s continued strategic growth expansion in the areas of employee benefits.

Baltas, who was the president and founder of Union Insurance Group, brings with him more than 20 years of benefits experience, specializing in financial and technical aspects of employee benefits plan design and application.

Northeast Ohio Movers and Shakers

The Davey Tree Expert Co. recently announced that Pat Covey has been named the new COO for all U.S. operations and Jim Stief has been promoted to executive vice president, operations.

Karl Warnke, Davey’s chairman, president and CEO, said the changes are part of an effort to recognize factors that have been critical to Davey’s success during this unstable economic period.

Pat Covey, COO, The Davey Tree Expert Co.

A long-time employee of Davey, Covey has served in various capacities with increasing responsibility in both the operations and administrative/support segments of the company. His most recent position was executive vice president, operations, a title he has held since 2007.

Jim Stief will be responsible for all U.S. residential and commercial operations, in addition to the Davey Resource Group. A 33-year employee of Davey, Stief began his career in the Atlanta residential territory. Over the years, he has served in a variety of capacities within the service line, including as operations manager of the western region.

NCA Financial Planners and its President and CEO, Kevin Myeroff, has been ranked by Barron’s magazine as the second best financial adviser in the state of Ohio, and the No. 1 adviser in northern Ohio.

NCA Financial Planners, an independent, full-service financial planning firm, has been on the “Top 1,000 Financial Advisers” list for the past seven years. It was also recently named a Weatherhead 100 company, making it one of the 100 fastest growing companies in Northeast Ohio. On a national level, Myeroff has been recognized as one of ‘America’s 100 Top Advisors’ by Barron’s for the past seven years.

Jim Stief, Executive Vice President of Operations, The Davey Tree Expert Co.

Positively Cleveland has announced that Michael Burns joined the organization as senior vice president of convention sales and services.
Burns has 30 years of experience within the hospitality industry, particularly in hotel operations, national sales and meeting planning. He spent 22 years with Conferon (now Experient), a nationally known meeting planning company in a variety of account management and leadership roles.
As the senior vice president of convention sales and services for Positively Cleveland, Burns is overseeing a sales team that is responsible for engaging stakeholders and soliciting companies interested in bringing their meetings and conventions to Cleveland, and a services team responsible for ensuring the best convention experience possible.

Great Lakes Integrated, a Cleveland-based graphic communications and printing company, is pleased to announce the appointment of a new CFO and two changes to the company’s executive leadership team.

David Eckhardt, CPA has joined the company as CFO. Eckhardt brings more than 25 years of experience in both private and public accounting, specializing in the manufacturing industry. Before joining Great Lakes Integrated, he served as CFO and controller at Advanced Polymer Coatings in Avon Lake and controller at Q-Lab Corp. in Westlake.

Kostika Radivoj has been named executive vice president of sales. Radivoj has worked at Great Lakes Integrated for over 34 years in a variety of areas, including: estimating, customer service, production planning, purchasing, scheduling and most recently held the position of executive vice president of operations.  In his new position, he will be responsible for the day-to-day management and business development of the entire Great Lakes Integrated sales’ operations.

Additionally, Robert Schultz has been named executive vice president of operations. Schultz has worked at Great Lakes Integrated for more than 35 years. He has served in positions including: estimating, accounting, CFO and executive vice president. In this new position, he will be responsible for the day-to-day operations, including overseeing processes, procedures and standards, as well as leading the continuous improvement initiatives within the company.

Cleveland Movers and Shakers

Moen Inc., the No. 1 faucet brand in North America, has promoted Tim Bitterman to director of marketing and new product development, Creative Specialties International.

In his new role, Bitterman will lead and direct the marketing, new product development and U.S. quality teams for the Moen accessory business. Since starting at Moen in 2000, Bitterman has advanced quickly through the company. His previous role was group marketing manager for Creative Specialties International.

Positively Cleveland has announced that Michael E. Mulhall has joined the organization as director of partnerships.

Mulhall has worked for more than 20 years in different facets of the tourism industry. He spent 11 seasons with the Cleveland Indians and more than 10 years in the theme park industry.

As the director of partnerships for Positively Cleveland, Mulhall is overseeing a team that is responsible for engaging stakeholders and companies interested in promoting Cleveland as a visitor destination through membership and partnership opportunities.

Cleveland Clinic officials have named Joanne Zeroske as the new president of Marymount Hospital.

Zeroske, a registered nurse with 30 years of experience at Cleveland Clinic, has served as Euclid Hospital’s president for the last three years. Under Zeroske’s leadership, Euclid Hospital earned recognition as a top-performing hospital in The Joint Commission’s new “Top Performer on Key Quality Measures” program.

The Joint Commission recognized Euclid Hospital for achieving excellence in performance on its accountability measures for heart failure, pneumonia and surgical care. Zeroske began her career at Cleveland Clinic in 1982 as a staff nurse in the cardiology post-operative unit.

Sam Falletta, President and CEO, Incept

Incept, a Canton-based conversational marketing firm, has appointed Sam Falletta to president and CEO. The appointment culminates a 15-year career at the company during which Falletta helped grow Incept from 10 employees to 250.

He previously served as president at Incept and led the company to average annual growth of greater than 40 percent. Under Falletta’s leadership, the organization was recognized as one of Northeast Ohio’s top workplaces and the No. 1 midsized company to work for in Canton.

Falletta began at the company in 1997 and has held various leadership positions including vice president/general manager and COO.

Lionel Batty, President of Graphite Electrodes, GrafTech International Holdings Inc.

GrafTech International Holdings Inc. announced that it has promoted Lionel Batty to the position of president of graphite electrodes and Julian Norley to the position of vice president of corporate research and development.

Batty joined the company in 1983 and has worked across many functions, including operations, customer technical service and quality assurance in both the graphite electrode and the advanced graphite materials businesses.

Batty has been GrafTech’s vice president of corporate R&D since 1999. In this role, he led the development of many of the company’s innovations in recent years. 

Stepping into Batty’s previous role is 14-year GrafTech R&D veteran Julian Norley. As the vice president of corporate R&D, he is tasked with directing GrafTech’s global R&D organization.

Previously Norley served as senior corporate fellow. Prior to joining GrafTech, Norley was a materials research scientist at Aircraft Braking Systems and British Petroleum.

Scott Rickert, president and CEO of Nanofilm, was recently named to the Most Influential Nanotechnology Leaders List for 2011 by the NanoBusiness Commercialization Association, a group dedicated to promoting the commercialization of nanotechnology and helping companies bring affordable, life-improving nanotech products to the market.

The honorees include 25 business executives, researchers and government leaders. Nanofilm is a leader in nanofilm technology and self-assembling thin films for a variety of substrates and surfaces.

Cleveland Deals Page: Ready and Waiting

Albert D. Melchiorre, President, MelCap Partners, LLC

The perfect storm for sellers in 2012 was the outlook at the end of 2011. Apparently, buyers have been slow to get on board due to lingering concerns about the economy and the European debt crisis. These buyers seem to be ready, set and waiting for this perfect storm to calm down as indicated by January’s data.

According to CapIQ, the number of closed M&A transactions in the United States (including undisclosed values) was 1,418 in January 2011 and 1,014 in December 2011.  The first month of 2012 was 1,046, up slightly from December 2011 but down from January 2011. Locally, Northeast Ohio encountered the following closed M&A transactions: 44 in January 2011, 41 in December 2011 and 30 in January 2012.  December and January are typically the busiest months of the year when it comes to closed deals. This historical trend would suggest that the rest of the year would be less active, but with private equity needing to invest and with high cash on hand for strategic buyers, conditions are still in place for solid deal making throughout 2012.

Local strategic buyers wasted no time announcing acquisitions in January after completing a handful of acquisitions in December 2011. TransDigm Group Inc. led the acquisitive charge within the manufacturing industry with its $750 million acquisition announcement of AmSafe Global Holdings Inc. from a group controlled by Berkshire Partners LLC and Greenbriar Equity Group LLC. AmSafe had 2011 revenue of approximately $260 million.

Within the real estate industry, DDR Corp. and Blackstone Real Estate Advisors announced the purchase of 47 U.S. shopping centers with a proposed transaction value of $1.43 billion.

Dan Gilbert completed the sports owners “trifecta” with his January purchase of the Cleveland Gladiators as part of the Arena Football League. This adds to his investments in the Cleveland Cavaliers and the Lake Erie Monsters, a minor league hockey team.  Gilbert’s Cleveland sports investments, and his investment in the city’s forthcoming casino, solidifies his commitment to the future of Northeast Ohio.

Resilience Capital Partners purchased Weaber Inc., one of the nation’s leading hardwood lumber producers in Lebanon, Pa., employing more than 300 people. Meanwhile, The Riverside Co. ended 2011 with a record 29 completed acquisitions and is not stopping in 2012 as another three acquisitions were completed in January.

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 TransDigm for announcing its $750 million acquisition of AmSafe Global Holdings. Nicholas Howley, TransDigm’s chairman and CEO, stated that the deal “meets our strategic, operational and value-creation criteria. … Most of AmSafe’s revenues come from highly engineered, proprietary aerospace product with substantial and growing aftermarket content.” 
AmSafe is well-known for its proprietary aviation passenger seatbelts and airbags. The company’s products are on nearly all of the world’s airlines with products certified and installed on more than 90 percent of the aircraft produced worldwide. AmSafe is the first and only company to have a seatbelt airbag system installed worldwide on both commercial transport and general aviation aircraft.

Movers & Shakers

Emmanuel Glover has been named senior vice president and director of community




development for Fifth Third Bank. He will support the bank’s community development initiatives and compliance with the Community Reinvestment Act and fair and responsible lending. Glover joins Fifth Third Bank with more than 17 years banking experience, most recently with KeyBank where he was vice president of Key’s community development banking division and held the title of underserved market manager, focusing on community development market activities throughout 14 states.

The Society for Vascular Surgery elected Sean Patrick Lyden as a distinguished fellow during its Vascular Annual Meeting in June in Chicago.

The designation of distinguished fellow is bestowed upon an active, international or senior member of the SVS who has made substantial, sustained contributions in two of three categories — research, service or education. The application process requires three letters of support from SVS distinguished fellows. 

Lyden is an associate professor and the medical director clinical supply chain at Cleveland Clinic Lerner College of Medicine of Case Western Reserve University. Board certified in general and vascular surgery, Lyden also has a registered physician in vascular interpretation degree.

Vitamix was inducted into the Made in the USA Foundation Hall of Fame for its contribution to job creation, accurate labeling, promotion of American-made products, and labor and environmental standards.

League Park Advisors hired Wayne Twardokus and Ari Deutchman as members of its middle-market investment banking team.

Twardokus joins League Park from Harris Williams & Co., where he worked as a vice president originating and executing mergers and acquisitions for middle-market companies. While at Harris Williams, Twardokus was active within the specialty distribution and industrial manufacturing verticals. He also previously worked as an associate at National City Capital Markets and Brown Gibbons Lang & Co.

Deutchman was previously with Ally Commercial Finance in New York City. While at Ally Commercial Finance, he managed a private equity fund investment portfolio, as well as a secured credit facilities portfolio in the industrial manufacturing, health care, transportation, retail and energy sectors.

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Business Pulse

As summer ends and the cold, gloomy winter draws closer, Ohio companies remain on fire. Eighty percent of the selected August transactions listed on this page included Ohio companies as buyers. The Northeast Ohio region remains acquisitive in the face of high market volatility. The uncertainty of a global economic recovery and unstable equity markets has shaken some confidence in the M&A market. However, companies continue to pay high dollar for strategic fits that will add market share and build long-term value.

OM Group Inc. completed its strategic acquisition of Vacuumschmelze GmbH & Co. KG for $950.9 million on Aug. 2. The acquisition will give OM Group greater presence in emerging markets and further mitigate raw material pricing volatility through economies of scale.

RPM International Inc. also made an international acquisition with the purchase of API S.p.A. The $28 million company, located in Genoa, Italy, is a producer and installer of polyurethane and urethane-based flooring for the marine industry, primarily luxury boats. The company will complement the commercial polymer flooring businesses already owned by RPM and will give RPM a greater presence in the decorative flooring space.

Private-equity groups remained somewhat quiet this month, yet some were still very busy acquiring Northeast Ohio companies. The Riverside Co. continued its great year with its 13th acquisition of the year, Sunless Inc. The Macedonia company manufactures spray tanning booths, airbrush equipment and retail products in the sunless tanning segment. Finally, Weinberg & Bell Group acquired Cleveland-based Channel Products Inc., a manufacturer of ignition systems and safety controls for gas appliances.

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

August’s deal of the month goes to TransDigm Group Inc., for the acquisition of Kent-based Schneller Holdings LLC. TransDigm acquired Schneller on Aug. 31 from Graham Partners for $288.5 million in cash. Schneller manufactures a variety of laminates, thermoplastic sheets, utility flooring and custom applications for the aviation and rail industries. Schneller’s decorative materials are found on most Boeing platforms, all active Airbus platforms and most regional jets. Two-thirds of Schneller’s revenues come from the commercial aftermarket with most of the company’s products being used for aircraft side walls, lavatories, galleys, bulkheads and cabin floors.  It is anticipated that Schneller’s revenues will reach $84 million in 2011.

TransDigm’s acquisition comes just a week after the board of directors authorized a repurchase program of up to $100 million of common stock. This move should add flexibility and strengthen the company’s position through various uses of cash, including both acquisitions and the repurchasing of stock. The acquisition of Schneller is expected to build value as both companies’ products and markets align, increasing Transdigm’s aerospace market share.

Northeast Ohio is in a buying mood

Even with the lackluster gross domestic product data from the second quarter and uncertainties surrounding governmental debt and its effects on the marketplace, the mergers and acquisitions market has continued to improve as aggregate deal value, private equity fundraising and debt availability have all shown positive signs of growth over the first half of the year. Northeast Ohio businesses remain both acquisitive and aggressive as July was another solid month for local wheeling and dealing. Twenty of the 24 transactions listed on this page, or roughly 83 percent, represent Ohio companies as the buyer in the transaction.

Both Olympic Steel Inc. and Timken Co. completed acquisitions on July 1. Olympic Steel purchased Chicago Tube and Iron for $150 million while Timken acquired Philadelphia Gear for $200 million. These transactions allow both companies to deliver more value to current customers and allow both companies to reach a wider audience.

Sherwin-Williams Co. increased its product line in the United Kingdom with the purchase of Leighs Paints on July 6. Leighs Paints employs 260 people and distributes its products to 47 countries. Leighs’ FIRETEX brand will join Sherwin-Williams Protective & Marine Coatings division and will be a key product as it has been used on more than 400 projects worldwide.

Lincoln Electric Co. completed a pair of acquisitions at the end of July. The first acquisition was for Techalloy Welding Products, a producer of nickel alloy and stainless steel welding consumables. Lincoln also completed a deal for Torchmate, a manufacturer of CNC plasma and oxyfuel cutting tables. The combined revenues of the two companies being bought is about $90 million. The deals will allow Lincoln to continue to expand its relationships with customers through broader product offerings.

On the private-equity front, there was also activity as The Riverside Co., Rockwood Equity, SFW Capital and Linsalata Capital Partners all completed acquisitions in July. Again, although the markets and economy appear to be slower than anticipated, Northeast Ohio’s deal activity remains positive.

Deal of the Month

OM Group Inc. receives July’s deal of the month for its recent announcement that the company will acquire Vacuumschmelze GmbH & Co. KG out of Hanau, Germany for $1 billion. VAC is a global producer of advanced magnetic materials and related products, employing more than 4,800 employees in 50 countries. With sales of approximately $503 million, VAC holds more than 750 patents for products used in renewable energies, automotive technology, medical technology and aerospace industries.

OM Group’s acquisition will give the company greater presence in China and India, further mitigating raw material pricing volatility through economies of scale. The acquisition also allows OM Group to add more capabilities in alternative energy as VAC produces products used in wind turbines and solar development. With this move, OM Group continues to become more diversified through providing not just metal materials, but also engineered products.

Movers & Shakers

Patricia T. Horvath has been named executive director of UnitedHealthcare

Denise Afflerbach

Dave Sobochan

Mary Ann Stropkay

Employer & Individual in Northern Ohio. She joined UnitedHealthcare in 2001 as managing director of health and wellness strategies for the Central and Western regions. 

Sweeney founder James B. Sweeney was named as the agency’s first CEO. Jennifer A. Manocchio is now president. She most recently served as vice president and general manager of the company’s Wilmington, N.C. office.

Sweeney established the agency in 1986 and will focus on agency growth, business development, creative services and quality assurance. Manocchio will take responsibility for client services and agency operations, including personnel, technologies, vendor relations and partnerships/acquisitions.

Michael E. Stevens, executive vice president of retail and leasing for Forest City Enterprises, was recently awarded the 2011 ICSC (International Council of Shopping Centers) Trustees Distinguished Service Award. This is the highest honor awarded by ICSC and is the association’s most prestigious official recognition of distinguished service and contribution to the association, to the worldwide retail real estate industry and to the community at large.

Dave Sobochan, principal in the tax department of Cohen & Co., was awarded the 2011 Member of the Year Award from the Northern Ohio Chapter of NAIOP, the commercial real estate development association. 

Gene D. Karlen joined Javitch, Block and Rathbone as director of human resources. Karlen has 12 years of experience in human resources.

 The Museum of Contemporary Art Cleveland recently elected officers and six new members of its board of directors.

Officers include: Scott Mueller, chairman of the board, who is president and CEO of Dealer Tire; Mary Ann Stropkay, president,  chief credit officer of Park View Federal Savings Bank; Toby Devan Lewis, vice president; Char Fowler, vice president; and Scott Bogard, treasurer, senior associate at The Riverside Co.

New board members are: Kristen M. Bihary, vice president, communications at Aleris; Joanne Cohen, executive director and curator of Cleveland Clinic’s art program; David Doll, senior vice president of investments at UBS; Jen Grossman, co-owner of National Safety Apparel; Grosvie Robinson Cooley; and Bassem A. Mansour, co-CEO of Resilience Capital Partners.

Morton’s the Steakhouse Cleveland hired Denise Afflerbach as the new assistant manager. She most recently served as food and beverage manager at the TPC

Sawgrass golf club in Jacksonville, Fla., where she gained extensive hospitality management experience.

MedData hired Brenda N. Brown as director of compliance audits and education. In this newly created position, she will be responsible for providing ongoing documentation, training and education to MedData’s clinical and coding staff to ensure operational compliance and optimal reimbursement.

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Building momentum

While the current number of closed U.S deals thus far in 2011 is less than the number of deals at the same time last year, the total dollar volume of 2011 transactions is much higher. Combining more investment money with fewer deals has elevated the average deal value and created higher valuations and stronger demand for healthy companies. Strategic buyers have started to use some of the excess cash on their balance sheets for synergistic opportunities. Private equity firms are using their capital for quality acquisitions. With higher corporate earnings and more liquidity in the debt markets, the overall outlook of the M&A market remains positive.

Ganeden Biotech’s probiotics have been under strong demand lately. On June 2, Schiff Nutrition purchased the Sustenex and Digestive Advantage brands and rights to GanedenBC30 technology, which has more than 95 U.S. and foreign patents. Ganeden, headquartered in Mayfield Heights, sold the brands for $40 million. The probiotics industry has grown recently at an annual rate of approximately 20 percent.

OfficeMax may have relocated its headquarters from Shaker Heights to Naperville, Ill., but the company still has an eye on the Cleveland region. OfficeMax acquired Cleveland-based Warren-Chaney Office Furniture and hopes to integrate the company into its contract office furniture dealership, OM Workspace. This will allow the furniture store to add more value to its customers and, more importantly, to stay in Cleveland.

The Riverside Co. closed multiple transactions in June. The company added to its medical supply platform, ActivStyle, with the acquisitions of Home Wellness Inc. and Stay Dry Products Inc. This makes the third acquisition to this platform this year. Riverside also added Alliance 1 to its platform, Express Courier, to give the delivery service company more access to the Tennessee market.

Finally, Eaton Corp. is strengthening its reach beyond U.S. borders with two international deals. The first is an acquisition of a reseller of industrial electrical equipment in Colombia, with sales of $8 million in 2010. The strategic objective is to establish strong relationships with electrical OEMs and distributors in Colombia. The second is an announcement of the acquisition of E. Begerow GmbH & Co. KG, a liquid filtration solutions target in Germany with sales of more than $84 million.

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 deals of the month belong to Blue Point Capital Partners for its sale of Packers Holdings LLC to Harvest Partners LLC, and second, for its recapitalization of Alco Manufacturing Corp. LLC. Blue Point’s success continues with the sale of Packers Holdings in which the firm received a return of six times invested capital and achieved a 250 percent increase in EBITDA during a four-year period. Packers Holdings, headquartered in Twinsburg, employs more than 9,000 people and is the largest nationwide provider of mission-critical outsourced cleaning and sanitation services to the food industry.

Blue Point’s second deal of the month will give the firm another platform company in the Cleveland area. Elyria-based Alco manufactures close-tolerance precision machined steel components for the North American hydraulic products market. Founded in 1971, Alco is looking to take advantage of serious untapped growth opportunities in addition to increasing its current annual production of 60 million components.