Unifrax, a portfolio company of Clearlake Capital, has agreed to acquire publicly traded Lydall at an enterprise value of approximately $1.3 billion. Clearlake acquired Unifrax from American Securities in October 2018.
Lydall (NYSE: LDL) designs and manufactures specialty filtration media, industrial thermal insulation products, and acoustical barriers. The company’s products are used by original equipment manufacturers, and Tier 1, Tier 2, and Tier 3 customers that are active in the industrial, life sciences, automotive, food and beverage, biopharmaceutical, and medical sectors.
Manchester, Connecticut-headquartered Lydall, led by CEO Sara Greenstein, was founded in 1879 and has 23 manufacturing facilities around the world.
In FY 2020, Lydall had revenues of $764 million and EBITDA of $67 million. With an enterprise valuation of $1.3 billion, this equates to a 19.4x EBITDA valuation multiple. To see a copy of Lydall’s May 2021 investor presentation click HERE.
“We are excited about the combination of Lydall and Unifrax. With this transaction, we are creating a leader in specialty filtration and advanced materials with over 250 years of combined expertise and experience delivering innovative and compelling solutions to customers worldwide,” said Ms. Greenstein.
Unifrax is a supplier of specialty fibers and inorganic materials that are used in emission control, thermal management, filtration, battery and fire protection applications. The company’s ceramic and microfine glass fiber products are sold worldwide, primarily to more than 4,000 industrial, commercial and automotive customers.
Unifrax operates 31 manufacturing facilities in the United States, Europe, the Middle East, Russia, Asia, South Africa and Latin America. The company, led by CEO John Dandolph, has more than 2,300 employees and is headquartered near Buffalo in Tonawanda, New York.
“The combination of Unifrax and Lydall creates a global specialty materials platform with new cutting edge technologies in advanced filtration, electric vehicle battery systems, and energy-saving applications,” said Mr. Dandolph. “The addition of Lydall’s people, technologies, and assets to the Unifrax portfolio will help accelerate our innovation pipeline and creates a world-class platform capable of solving the world’s most pressing energy consumption, environmental and filtration challenges.”
“We have long admired Lydall and what it would bring to our platform investment in Unifrax, and we could not be more excited about partnering with the company and its team to build one of the world’s leading global specialty materials platforms,” said Managing Partner José Feliciano and Partner Colin Leonard in a released statement. “We have supported Unifrax’s development of new technologies over the last few years that have the potential to change how we think about the industries in which both Unifrax and Lydall operate and inform their futures. The addition of Lydall to the Unifrax portfolio and its strong capabilities in advanced filtration creates a global platform with significant scale that together can accelerate each company’s respective compelling growth plans.”
Clearlake invests in industrials and energy; software and technology-enabled services; and consumer sectors. The firm was co-founded by Mr. Feliciano and Behdad Eghbali in 2006 and is headquartered in Santa Monica, California with an additional office in Dallas, Texas.
In April 2020, Clearlake held a hard cap and oversubscribed final close of its sixth private equity fund, Clearlake Capital Partners VI LP, with more than $7 billion in commitments. Clearlake currently has approximately $39 billion of assets under management.
Morgan Stanley & Co. and J.P. Morgan were the financial advisors to Unifrax, and BofA Securities was the financial advisor to Lydall.
The buy of Lydall by Unifrax is expected to close in the second half of 2021.
© 2021 Private Equity Professional | June 22, 2021
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