H.I.G. Capital Announces Sale of Transtar Metals to A.M. Castle & Co.
MIAMI – September 5, 2006 – H.I.G. Capital, a leading private equity firm based in Miami, Florida, announced today that it has completed the sale of Transtar Metals (“Transtar”) to A.M. Castle & Co. (AMEX: CAS), a leading North American distributor of highly engineered metals and plastics for $180 million.
Transtar (www.transtarmetals.com), headquartered in Torrance, California, is the leading manager world-wide of the aerospace and defense industries’ high-performance alloy supply chain. Offering its customers the widest available selection of highly specialized products, Transtar is the only major supplier of both flat-rolled and extruded high-performance alloy products. Transtar operates through eight major facilities strategically located in aerospace hubs throughout the United States and Europe, from which it ships products throughout the world.
H.I.G. recapitalized Transtar in December 2002 in partnership with the company’s Executive team led by CEO Steve Scheinkman. Since that time, H.I.G. and the Transtar management team have worked together to focus and strengthen the business by exiting non-core business units, rationalizing the facility base, converting customers to long term contracts and gaining market share by strategically aligning with high growth customers and market segments. Excluding the revenue from previously divested divisions, as well as from Transtar’s 50% stake in All Metal Services which is being retained by H.I.G., the Company’s revenue increased by over 90% to $275 million during the time of H.I.G.’s ownership. The Management team was also able to drive margins substantially higher in the same time period.
Steve Scheinkman, CEO of Transtar, commenting on the deal, said “H.I.G. has been a strong and loyal partner to the management team through thick and thin. They consistently provided insightful strategic advice, access to capital, and did lots of heavy lifting. Most importantly, they always kept their word.”
Matt Sanford, Managing Director of H.I.G., commented, “Working with Steve Scheinkman and his exceptional management team has been a great experience. We partnered together to acquire the Company at a very difficult time in its history and a very difficult time for the marketplace that it served. Together with management, we successfully restructured and refocused the business which has led it to achieve record levels of profitability and be extremely well positioned to benefit from the exciting growth in the aerospace market. This partnership has led to outstanding returns for H.I.G.’s investors and the Transtar team.”
Alexander Moskovitz, Principal of H.I.G. remarked, “Transtar is the leading manager of the high performance alloy supply chain in the aerospace and defense industries world wide. This transaction represents a win-win outcome that is typical of partnerships between H.I.G. and our portfolio company management teams.”
About H.I.G. Capital
H.I.G. Capital LLC (“H.I.G.”) is a leading private equity and venture capital investment firm with more than $3 billion of equity capital under management. Based in Miami, and with offices in Atlanta, Boston, and San Francisco, H.I.G. specializes in providing capital to small and medium-sized companies with attractive growth potential. H.I.G. invests in management-led buyouts and recapitalizations of profitable and well managed manufacturing or service businesses. H.I.G. also has extensive experience with financial restructurings and operational turnarounds. Since its founding, H.I.G. has completed in excess of 70 transactions. The firm currently manages a portfolio of more than 40 companies with combined revenues in excess of $5 billion. For more information, please refer to the H.I.G. website at www.higcapital.com.