Bertram Capital has acquired Safety Products Holdings (SPH), a provider of safety cutting tools and accessories, from Levine Leichtman Capital Partners (LLCP). The buy of SPH is the third platform investment for Bertram’s fourth fund.
Safety Products operates through two segments, California-based Pacific Handy Cutter (PHC) and Michigan-based Klever Innovations. Together, the two segments design, manufacture and market safety cutters, utility knives, blades, and other accessories used in commercial backroom operations in the grocery, retail, quick serve restaurant, industrial warehouse, and consumer end markets.
Since its formation in 2018, Safety Products has been led by CEO Mark Marinovich, who for 14 years was the CEO of Pacific Handy Cutter.
Pacific Handy Cutter was acquired by LLCP in May 2016 from American Capital. The add-on acquisition of Klever Innovations closed in December 2018.
“Through its two brands, Pacific Handy Cutter and Klever Innovations, SPH has established itself as a leading provider of safety cutting solutions,” said Kevin Yamashita, a partner at Bertram Capital. “The company’s success reflects its superior product offering, US-based manufacturing capabilities, and compelling safety value to its customers, as well as its entrenched relationships with marquee customers across a variety of industries. We are excited to partner with Mark Marinovich and the SPH team.”
Bertram invests in middle-market business services, consumer, industrial and manufacturing companies that have revenues from $25 million to $250 million and EBITDA of $5 million to $30 million. The firm is headquartered south of San Francisco in San Mateo, California.
“We are excited to partner with the SPH team to pursue an aligned value creation strategy. The company is well-positioned to expand its leadership in a niche sector that continues to benefit from favorable secular tailwinds,” said Jeff Drazan, the managing partner of Bertram Capital. “We believe our Bertram Labs technology enablement team will be a significant tool for SPH to leverage to further accelerate growth.” Bertram Labs is the firm’s internal team of engineers, software developers, social media/digital marketing specialists, website designers and graphic artists that provide strategies and technologies to Bertram’s portfolio companies.
Levine Leichtman Capital Partners (LLCP) invests in middle-market companies located in the United States and Europe. Sectors of interest include consumer and branded products, franchises, business services, healthcare, education, engineered products and light manufacturing.
“The investment in PHC has been extremely successful for LLCP and the company’s management team,” said Matthew Frankel, a managing partner at LLCP. “Since our initial investment in 2016, we executed two transformational acquisitions, vertically integrated the company’s manufacturing processes and expanded into new end markets and geographies. We are excited to see PHC continue to execute on its growth plan and wish the company continued success in the future.”
Barings was the administrative agent, syndication agent, and sole lead arranger and bookrunner of a senior secured credit facility that backed Bertram’s buy of SPH.
“We have previously worked alongside Bertram Capital to fund investment opportunities in both the US and Europe, and we are thrilled to continue our longstanding relationship by supporting the Safety Products transaction,” said Max McEwen, a managing director in Barings’ global private finance group. “We strongly believe that Safety Products represents the gold standard in its category, and we are excited to assist Bertram Capital and the company in its next phase of growth. In the current market environment, we are focused on opportunities to invest in high-quality companies backed by top-tier sponsors, and this investment certainly fits those criteria.”
Barings global private finance group provides senior debt and junior capital of up to $200 million to back middle-market buyouts, acquisitions, and recapitalizations. The group has more than 60 professionals and offices in Charlotte, Chicago, New York, Hong Kong, London and Sydney. The private finance group is part of Barings, a subsidiary of Massachusetts Mutual Life Insurance Company. MassMutual acquired Baring Asset Management in 2005 from ING Group and in 2016 combined it with Babson Capital Management, Wood Creek Capital Management, Cornerstone Real Estate Advisers, and Baring Asset Management to form Barings.
© 2021 Private Equity Professional | February 9, 2021
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