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Betting Big on Heavy Construction

July 25, 2011 by Leave a Comment

It was recently announced that Summit Materials had acquired six companies:

  • Elam Construction
  • Grand Junction Concrete Pipe
  • Fischer Quarries
  • B&B Resources
  • Triple C Concrete
  • Wind River Materials

It always peaks my curiosity when I see a company announce this many acquisitions. So I did a little digging. Turns out that Summit Materials is a “platform company” and was formed by a group of investors, including The Blackstone Group and Silverhawk Capital Partners, in 2009. The goal of the platform company is to acquire companies in the “aggregates and heavy-side building materials sector,” according to Summit’s release.

Serial Acquirers Out In Full Force

July 15, 2011 by Leave a Comment

Most middle-market business owners are surprised when they learn how active professional buyers are in the U.S. The misconception that I find all too common is that the recession killed M&A activity and that it has yet to recover. I think we have put most of that myth to rest in past articles we have published about today’s market being a seller’s market, M&A activity being up 30% and a number of synergistic private equity add-on acquisitions. But what really surprises people is just how active strategics are in today’s market. Most of these deals get very little publicity since they usually are not billion-dollar mega-deals. Buyouts recently analyzed the most active strategic buyers since January of 2010.

A Middle-Market PE Deal: Platinum Invests in Nordquist

May 31, 2011 by Leave a Comment

Recently it was announced that Platinum Group (Platinum) had acquired the assets of Nordquist Sign Company (Nordquist). Nordquist has designed, fabricated and serviced signage for businesses and institutions since 1904. Terms of the deal were not disclosed. Nordquist is located in Minneapolis and employs 16 people.

Several features of this deal caught my attention. First, it is a good example of a lower middle-market private equity deal. Even though the details of the transaction were not released, with only 16 employees, it is safe to assume that Nordquist is a middle-market sized company. Many business owners are under the mistaken impression that equity firms only invest in very large, high-growth transactions. The reality is there are literally hundreds of equity firms that specialize in investing in middle-market companies just like Nordquist (for further details, see “Busting the Myth that Private Equity Firms Only Invest in Billion Dollar Deals”).

A Deal in the News: Alpine Investors Acquires Berkeys

May 26, 2011 by Leave a Comment

From time to time, the announcement of a closed deal in the news catches my eye. These deals can range from A to Z in terms of industries, acquirers, locations, etc. What they all typically have in common is that they highlight forward thinking on the part of the acquirer.

One thing that continually amazes me is the leading-edge thinking that equity firms use to determine the industry and/or businesses they are going to target. The folks managing solidly performing equity firms are usually thinking three to five years down the road and are anticipating what the economy will look like then, not necessarily what it looks like right now.

A deal announced last week falls into this category. Alpine Investors (Alpine), a middle-market private equity firm based in San Francisco, announced that it had invested in Berkeys Air Conditioning and Plumbing, a leading provider of residential plumbing and HVAC services in the Dallas/Ft. Worth metropolitan area.

Busting the Myth That Private Equity Firms Only Invest in Billion-dollar Deals

May 23, 2011 by Leave a Comment

Quite a few middle-market business owners are still under the mistaken belief that private equity firms (PE firms) only invest in mega-deals in the billion-dollar range. Because these larger deals tend to get all the press, it is understandable why middle-market business owners have this common misconception.