Periculum Advises Saran Industries, LP in its sale to Titan Equity Partners, LLC

Periculum Capital Company, LLC (“Periculum”) is pleased to announce the acquisition of Saran Industries, LP (“Saran” or the “Company”) by Titan Equity Partners, LLC (“Titan”). Periculum acted as the exclusive financial advisor to Saran in connection with the transaction.

Saran is a leading provider of industrial finishing and custom processing of forgings, castings, and machined parts. Based in Indianapolis, Indiana and operating out of two facilities, Saran has extensive capabilities to handle a broad variety of surface finishing services for the foundries and end users they serve including a substantial focus on work for the automotive industry.

The Company has experienced significant growth since 2008 by focusing on providing a full-service solution to its customers. With more growth opportunities on the horizon, the shareholders decided it was time to partner with a firm that could help execute on the growth of the business and allow the founding shareholders to have a more customer centric focus, as well as develop another unrelated business opportunity. Periculum identified and contacted numerous strategic buyers and private equity firms across the globe that were potential fits to continue the growth of Saran. In the end, Saran selected Titan because of the firm’s experience in automotive-related enterprises, its ability to support the growth initiatives, and its approach to partnering with management. Lastly, the shareholders were able to maintain a meaningful ownership share that allows them to participate in the future returns of the business. Tony Pesavento, Managing Partner of Titan, said, “Titan is pleased to be teaming up with Sam and Nick Saran. The Company has a strong customer base and excellent metal processing capabilities that will allow us to build Saran through thoughtful geographic expansion.”

Titan, based in Chicago, Illinois, has completed transactions across a wide range of specialty manufacturing and distribution companies. Titan recognizes management’s pivotal role in the value creation process and, therefore, views it as essential that key managers participate meaningfully in the equity returns of the enterprise.

Periculum Advises Reputation Services and Manufacturing, LLC. in its Acquisition of Fleet Service of Tulsa, Inc.

Periculum Capital Company, LLC (“Periculum”) is pleased to announce that it served as the buy-side advisor to Reputation Services and Manufacturing, LLC. (“RSM”) in its acquisition of Fleet Service of Tulsa, Inc. (“Fleet”). This marks Periculum’s third energy and oil services related transaction in the last 18 months. Periculum is highly focused on advising businesses involved in the energy services industry regarding mergers and acquisitions and capital raising.

RSM is a holding company founded by a group of seasoned oil field equipment professionals for the purpose of acquiring businesses involved in the manufacturing, remanufacturing, service, repair, and testing of oil field servicing equipment. The Company is specifically focused on hydraulic fracturing pumps and related equipment used by major well servicing companies. The acquisition of Fleet represents the initial platform investment to facilitate sourcing business from several major, multi-national well servicing companies involved in the most active shale plays around the globe.

Headquartered in the Tulsa, Oklahoma metropolitan area, Fleet is ideally situated in the nation’s transportation corridor, as well as centrally located to many of the country’s most active shale plays. These plays include the Eagle Ford, Barnett, and Permian of Texas, the Bakken of North Dakota, the Haynesville of Louisiana, the Utica of Ohio, and the Marcellus of Pennsylvania. Fleet specializes in the testing and repair of various types of high-spec well servicing equipment, as well as performing engine overhauls, transmission overhauls, and repairs on a variety of equipment from the on-highway, arborist, and general off-highway industries. The Company’s 20 year track record and strong brand name are recognized throughout the industry for providing first class remanufacturing, repair, and testing services.

As RSM’s financial advisor on the Fleet transaction, Periculum’s activities included assisting with valuation, negotiations, documentation, and providing various analytical support. Periculum will continue to be involved with the Company assisting the management team in sourcing, evaluating, and capital raising to support RSM’s strategic growth opportunities in the oil field equipment industry.

 

Periculum Advises Corn Flour Producers, LLC in its Sale to Bunge North America

Periculum Capital Company, LLC (“Periculum”) is pleased to announce the acquisition of Corn Flour Producers, LLC (“CFP”) by Bunge North America. Periculum acted as the exclusive financial adviser to CFP in connection with the transaction.

CFP is a wet mill manufacturer of high quality corn flour, or corn masa, located in southwestern Indiana. CFP was formed in February of 2004, and began operations in mid-2006 as a collaborative effort involving farmers, a flour milling engineering firm, and an owner of a tortilla manufacturing company.

Bunge North America is a vertically integrated food and feed ingredient company, supplying raw and processed agricultural commodities and specialized food ingredients to a wide range of customers in the animal feed, food processor, foodservice and bakery industries. With headquarters in St. Louis, Missouri, Bunge North America and its subsidiaries operate grain elevators, oilseed processing plants, edible oil refineries and packaging facilities, and corn, wheat and rice mills in the U.S., Canada and Mexico.

Though CFP had become a market leader in producing high quality masa, the founders decided it was time to transition the company to an owner that could accelerate the growth of the business. Periculum identified and negotiated with companies all over the world who were interested in continuing the growth of CFP. Ultimately, the shareholders of CFP determined Bunge was the best party to continue the CFP story.

 

Periculum Advises Integrated Electrical Services, Inc., (“IES”) (NasdaqGM: IESC) in its Purchase of MISCOR Group Ltd, (“MISCOR”) (OTCPK:MIGL)

Periculum Capital Company, LLC is pleased to announce that it served as the buy-side advisor to Integrated Electrical Services, Inc. in its acquisition of MISCOR Group Ltd.

IES is a holding company that owns and manages multiple operating subsidiaries, currently comprised of providers of industrial products and infrastructure services to a variety of end markets. The acquisition of MISCOR meets IES’ prudent strategic and financial criteria for investments and compliments IES’ existing industrial business.

MISCOR, based in Massillon, Ohio, provides electrical and mechanical solutions to customers throughout the United States and abroad through its two operating segments, Industrial Services and Rail Services. The Industrial Services segment provides maintenance and repair services for AC and DC electric motors and generators, as well as power generating and distribution equipment; manufactures, remanufactures and repairs industrial lifting magnets; and provides maintenance and repair services for railroad main and auxiliary generators, main alternators and traction motors. The Rail Services segment manufactures and rebuilds power assemblies, engine parts, and other components related to large diesel engines and provides locomotive maintenance, remanufacturing and repair services for the rail industry.

In 2012 Periculum served as the financial advisor to IES in obtaining a new three year revolving credit facility with Wells Fargo Capital Finance that provided capacity for the MISCOR transaction and IES’ ongoing growth strategy. As IES’ financial advisor on the MISCOR transaction, Periculum’s process included assisting with valuation, negotiations, documentation, and providing various analytical support.

 

Periculum Places Series A Preferred Units for SteadyServ Technologies, LLC

Periculum Capital Company, LLC ("Periculum") is pleased to announce the completion of a $5.0 million private placement of Series A Preferred Units for SteadyServ Technologies, LLC ("SteadyServ" or "Company"). This transaction follows the completion of a $1.5 million private placement of 6.0% convertible promissory notes completed for the Company by Periculum in March of 2013.

SteadyServ has developed a mobile, SaaS-based inventory and order management system for the beer industry called iKeg™. iKeg is an integrated hardware and software solution designed to measure and report, on a near-real-time basis and with a high degree of accuracy, the inventory of draft beer kegs as well as the volume of beer remaining in those kegs at restaurants, bars, and taverns. The iKeg system tracks the depletion of beer over a measured period of time and notifies both the beer distributor and the on-premise retailer as to the current volume level associated with each style of beer being tracked. In addition to reporting which kegs are in danger of running out of beer and approximately when this might occur, the iKeg system also provides a convenient mechanism for the on-premise retailer to place replenishment orders with its distributor before a keg runs out of beer. The Company has filed a non-provisional patent application on the unique aspects of its solution.

Headquartered in Carmel, Indiana, SteadyServ was founded in 2012 by Steve Hershberger, an experienced software and technology entrepreneur. Steve has assembled a strong team with extensive experience in software design and engineering, craft brewery marketing and operations, hardware engineering and manufacturing, mobile technology, finance, and business operations. Periculum worked closely with the founding shareholders from the inception of the business to review and validatethe market opportunity and to assist with the numerous product development, intellectual property, and strategic issues prior to and during both rounds of funding.

Periculum advises Florida Chemical Company, Inc. in its sale to Flotek Industries, Inc.

Periculum Capital Company, LLC (“Periculum”) is pleased to announce the acquisition of Florida Chemical Company, Inc (“Florida Chemical”) by Flotek Industries, Inc. (“Flotek”) (NYSE:FTK). Periculum acted as the exclusive financial adviser to Florida Chemical’s shareholders in connection with the transaction. The merger consideration for Florida Chemical was composed of $49,500,000 in cash and 3,284,180 shares of Flotek stock, which represented a total value of approximately $103 million as of the day of closing.

Chemical, based in Winter Haven, Florida, is the world’s largest processor of citrus oils and is a pioneer in solvent, chemical synthesis and flavor/fragrance applications from citrus oils with facilities located in Florida and Texas. Since its founding in 1942, the privately-held company has been an innovator in creating high performance, bio-based products for a variety of industries, including applications in the oil and gas business.

Flotek is a global developer and distributor of innovative specialty chemicals and downhole drilling and production technology. Flotek manages automated bulk material handling, loading and blending facilities. It serves major and independent companies in the domestic and international oilfield service industry. With headquarters in Houston, Flotek trades on the New York Stock Exchange under the ticker FTK.

 

Periculum places Term Loan Facility for ARBOC Specialty Vehicles, LLC

Periculum Capital Company, LLC (“Periculum”) is pleased to announce that it has completed the placement of a five-year senior secured cash flow term loan facility for ARBOC Specialty Vehicles, LLC (“ARBOC” or “the Company”), a portfolio company of H.I.G. Capital (“H.I.G.”). The facility will replace an existing financing and provide funds for a dividend to shareholders.

Periculum successfully assisted the Company in developing a new senior lending relationship and obtaining an overall financing structure that meets the needs of both the Company and H.I.G. Periculum’s involvement allowed the management team to focus on running the business while H.I.G. focused on their primary fund activities.

As exclusive financial advisor, Periculum’s role included identifying prospective senior lenders, working with existing relationships, orchestrating management meetings and follow up, obtaining and vetting a significant number of senior debt proposals, and assisting in the closing negotiations and documentation. As a result of this process, ARBOC obtained the term loan facility from a top-tier capital provider capable of supporting the Company’s long term growth initiatives.

Based in Middlebury, Indiana, ARBOC is a leading producer of specialty vehicles targeting the low-floor and mobility transportation markets throughout North America. The vehicles are designed for passenger transport both as part of public transit programs and for private operators. Through the Company’s dealer network, vehicles are sold to municipal transit authorities, universities, airports, churches and many other customers demanding market leading mobility solutions.

H.I.G. is a leading global private investment firm with over $12 billion of capital under management. The H.I.G. family of funds includes private equity, growth equity, real estate, debt/credit and public equities. H.I.G. aligns itself with committed management teams and entrepreneurs to help build businesses of significant value. The team of over 250 investment professionals has substantial operating, consulting, technology and financial management experience, enabling H.I.G. to contribute meaningfully to portfolio companies. H.I.G. invests in companies throughout the U.S. and Europe and has offices in Miami, Atlanta, Boston, Chicago, Dallas, New York, and San Francisco in the U.S., and affiliate offices in London, Hamburg, Madrid and Paris in Europe as well as Rio de Janeiro in South America.

Ongoing regulatory uncertainty has led to an emergence of lending alternatives to commercial banks, providing unique challenges and opportunities to firms looking to access the debt capital markets. Periculum’s highly-focused approach to the debt placement and M&A needs of family-owned, small-cap to mid-cap public, and middle market private equity owned companies provides the experience and insight necessary to navigate these evolving financing markets.

 

Orbis Education Services, Inc. secures $20 Million Financing

Periculum Capital Company, LLC (“Periculum”) is pleased to announce that its portfolio company, Orbis Education Services, LLC (“Orbis”) secured $20.0 Million in Convertible Preferred Membership Units from LLR Partners of Philadelphia, Pennsylvania. The funding will allow Orbis to expand its hybrid online nursing education programs to ten additional partners.

Led by an experienced team of education and healthcare veterans, Orbis works with colleges, universities, and healthcare systems to develop hybrid nursing degree programs, recruit new qualified students, and manage delivery of these programs. Orbis’s current partners include Marian University, Sharp Healthcare, St.Vincent Health, Northeastern University, Roseman University, St. Rose Dominican, and Glendale Adventist Medical Center.

Blending technology and traditional methods, Orbis provides a business solution to enable a hospital to become a virtual extension of a major university. Theory courses are taught by the university partner nursing faculty via interactive online classes that include threaded discussions, real-time webcasts, projects, assignments, and proctored examinations. Students have the flexibility of completing the online courses during day or evening hours and hands-on clinical preparation is taught by appointed university faculty assigned to work directly with students at partner healthcare locations.

Periculum worked directly with Orbis prior to the Company’s inception to review and validate the market opportunity, help set business and financing strategy, attract senior management, as well as provide capital. Periculum led two rounds of financing of both debt and equity to facilitate the Company’s start-up and initial expansion.

LLR Partners invested $20.0 Million in Convertible Preferred Membership Units. LLR Partners has invested in a number of successful for-profit education companies, and their involvement provides Orbis a value-added investment partner to assist with its growth trajectory. The transaction was structured to convert Orbis Education Services, Inc. from a traditional c-corporation into a Delaware limited liability company. This transaction structure enabled the existing shareholder base to achieve a significant capital gain tax benefit while preserving their economic interests in the Company going forward.

 

Periculum places $240,000,000 Revolving Loan for Central Sates Enterprises, LLC

Periculum Capital Company, LLC (“Periculum”) is pleased to announce that it has completed the placement of a $240,000,000 three-year Revolving Loan for Central States Enterprises, LLC (“CSE” or the “Company”). The loan contains an expansion feature that allows the Company to increase the facility to a maximum of $365,000,000.

Headquartered in Heathrow, Florida, with significant operations in Indiana and an international trading operation, CSE decided to use Periculum to run its bank financing process rather than go it alone due to ongoing economic uncertainty and the need to provide resolute focus on the process. The Company desired to maintain a multi-year structure that would meet its highly-seasonal working capital needs in a volatile commodity market exacerbated by the 2012 drought and sluggish global economic environment.

As the Company’s ongoing financial advisor, Periculum used its extensive financing market knowledge and experience to advise the Company on positioning and marketing its story, resulting in a significant over subscription from multiple participant banks and highly competitive market pricing and terms. Periculum’s role included obtaining competitive bank proposals that provided terms suitable to the Company’s needs, working with participant banks, and assisting in the closing negotiations and documentation. As a result of Periculum’s efforts, Central States obtained a three-year revolving facility with an Agent Bank and bank group capable of supporting the Company’s working capital needs and long term growth initiatives.

Central States' activities in the domestic grain markets involve extensive rail and river barge shipments, covering virtually all areas of significant corn and soybean production in the United States. The Company’s sources of grain include its own Indiana based grain terminal facilities, farmer cooperatives and other corporate and privately owned terminal facilities. The Company’s clients include large poultry and hog integrated operations, commercial feed mills, corn and soybean processors, ethanol producers, flour millers, Canadian, Mexican, and Polish grain consumers, and export operators in the Gulf of Mexico.

Periculum advises ABC Industries, Inc. in its sale to CID Capital, Babson Capital Management and management

Periculum Capital Company, LLC (“Periculum”) is pleased to announce the sale of ABC Industries (“ABC” or the “Company”) to CID Capital, Babson Capital Management and the management of ABC. Periculum acted as the exclusive financial adviser to ABC’s shareholders in connection with the sale of the Company.

ABC is the leading manufacturer of mine and tunneling ventilation products in the United States, and maintains a strong niche position with its line of industrial ventilation ducting products. Also, one of ABC’s core strengths is producing specialized industrial fabrics and adapting their use to applications in various industries. Areas of market concentration are focused around ventilation products and unique industrial fabric applications.

The Company’s CEO, who was also its largest shareholder, decided several years ago to develop a plan that would allow him to retire while putting his management team in a position to take ABC forward. Periculum became involved at this point to assist in defining what would be required to accomplish these goals. Responsibilities of key managers were expanded to prepare for the eventual transition. Strategic initiatives likewise were developed to build the business case for the growth and further development of the business.

Periculum’s assignment was then to sell control of ABC to a financial buyer at a fair market price, balanced by an opportunity for the existing management to play a significant role, both financially and managerially, in the Company. After receiving more than twenty indications of interest from financial buyers all over the country, the shareholders and management of ABC determined that CID Capital’s proposal provided the best balance to meeting the objectives of obtaining a fair price for the shareholders, achieving retirement for the CEO, and positioning management to take ABC to the next level.