Chicago PE firm acquires majority stake in Grand Rapids health care auditing company

January 14, 2018 - MiBiz

SpendMend LLC, a company that provides spending visibility and audit and recovery services to the health care industry, sold a majority stake to Chicago-based private equity firm Sheridan Capital Partners.

The recapitalization and investment from Sheridan Capital, which invested along with SpendMend’s founders and managers, will support the continued growth of the company.

Terms of the deal were not disclosed, although SpendMend’s founders and managers retained “a meaningful ownership stake in the business,” according to an announcement of the investment.

“Through our partnership with the Sheridan team, we look forward to accelerating the growth of SpendMend and further developing our capabilities and overall value proposition as it relates to the healthcare industry,” stated SpendMend President Rob Heminger.  Miller, Johnson, Snell & Cummiskey PLC served as the legal adviser for SpendMend, which worked with Grand Rapids-based advisers Charter Capital Partners.

Sheridan Capital was advised by the law firm of Katten Muchin Rosenman LLP. Fidus Investment Corp. and Cadence Bank provided debt financing for the transaction.
“As the market leader in health care audit recovery, SpendMend’s services help health care executives, operators and providers navigate an increasingly challenging macro-economic environment of reimbursement pressure and rising organizational costs,” said Jonathan Lewis, managing partner at Sheridan Capital. “Cost containment is and will continue to be a high-priority focus in health care, and SpendMend plays a critical part in helping organizations find and establish long-term operational sustainability.”

Sheridan Capital Partners focuses on leveraged buyouts in the health care and consumer industry. It specializes in U.S. and Canadian companies with enterprise values between $25 million to $150 million.

“Sheridan’s sector focus and ability to bring both relevant experience and immediate value to our organization was undeniable,” stated SpendMend CEO Dan Geelhoed.  more

Advisers expect strong deal flow for 2018, despite talent, geopolitical challenges

January 7, 2018 - MiBiz

M&A activity should remain strong in 2018 and perhaps get a push from federal tax reform.

As well, rising interest rates should not pose a barrier to deal flow, although most companies — whether on the buy-side or sell-side — face a key challenge with finding skilled talent. 

That’s according to a group of M&A advisers that MiBiz gathered for a roundtable discussion on the state of the deal-making market in West Michigan. 

Participants in the roundtable were:

  • Mike Brown, partner with Charter Capital Partners, a Grand Rapids-based investment banking firm
  • Jason Byrd, co-founder and managing partner at Concurrence Capital Holdings LLC, a Grand Rapids-based private equity firm
  • Jeff Helminski, managing partner at Grand Rapids-based Auxo Investment Partners, a private equity firm
  • Rajesh Kothari, managing partner at Cascade Partners LLC, an investment banking and private investment firm based in Southfield
  • Remos Lenio, partner at Grand Rapids-based Tillerman & Co., an investment banking and merchant banking firm
  • Matthew Miller, managing partner at BlueWater Partners LLC, a Grand Rapids-based investment banking and consulting firm
  • John Pollock, managing director of LV2 Equity Partners LLC, a Grand Rapids-based private equity firm 
  • Peter Roth, partner at Grand Rapids-based Varnum LLP, which sponsored the discussion

Here are some highlights from the discussion. 

Private equity deal positions Grand River Aseptic Manufacturing for growth

November 26, 2017 - MiBiz

Grand River Aseptic Manufacturing Inc. was struggling in late 2010 when a group of West Michigan investors put up $5 million to acquire the company’s assets.

The initial investment seven years ago put GRAM onto the right trajectory. The company began attracting clients, secured additional capital, and over the years grew to more than $20 million in annual sales with a workforce of 160, nearly three times that of just a few years earlier.

Now a fast-growing contract developer and manufacturer of injectable drugs for pharmaceutical companies, GRAM is entering a new stage. Investors this month sold a majority of the company to private equity firm Arlington Capital Partners of Chevy Chase, Md.

The investment recapitalized GRAM for expansion and continued fast-paced growth.

“As many people in West Michigan know, it wasn’t an easy start for the company and it took a while to get its feet under them and gain some traction,” said John Kerschen, the managing director at Charter Capital Partners, a lead investor that retained a minority interest in GRAM.

“We’re happy to make money and have success as investors, of course, but it’s a really heartwarming story in terms of taking something from almost nothing to a nice, sustainable business,” Kerschen said. “GRAM would not be here if it weren’t for this collection of investors from around West Michigan or the state. It was a good collective effort.” more

Crystal Flash acquires Kalamazoo fuels distribution company

September 25, 2017 - MiBiz

Crystal Flash, an employee-owned fuels distribution company, continues its buying spree. The Grand Rapids-based firm said today that it had acquired Knapp Energy Inc. of Kalamazoo, a distributor of gasoline, diesel, home heating and lubricants with more than 900 customers, according to a statement. Crystal Flash expects to retain all of Knapp’s employees in the deal, which was finalized last week. Terms of the deal, Crystal Flash’s eleventh acquisition since 2011, were not disclosed.

Grand Rapids-based Charter Capital Partners advised Crystal Flash on the transaction.

“As we continue to expand our footprint, joining with companies closely align to our purpose and values is very important,” President Tom Olive said in a statement. “Our shared backgrounds as independent fuel distributors committed to exceptional service makes the Knapp acquisition a natural fit.” more

Investment Banking Firm Appoints Partners

September 11, 2017 - MiBiz

A local investment banking and capital management firm has named two new partners. Charter Capital Partners managing directors Mike Brown and Andrew Williams were promoted to the role of partner, with Brown leading the Grand Rapids investment banking and advisory practice and Williams leading the firm’s North Indiana office.

Both men will serve on the firm’s leadership team and share operational management and talent development responsibilities.

“Andrew and Mike have been instrumental in the growth of Charter into a Midwest leader, and these promotions are a testament to their strong work ethic, investment expertise and valuable insight,” Charter President and Managing Partner John Kerschen said. “This move also will allow our senior leadership to pursue additional strategic opportunities for growing Charter Capital’s scope of services and practice areas, while continuing our momentum that included a record year for the firm in each of the last three years and strong deal and advisory activity year to date.” more

Charter Capital Adds Two Partners to Business

September 3, 2017 - MiBiz

In a move designed to manage growth in the business, investment banking and M&A firm Charter Capital Partners promoted two managing directors to partners. Mike Brown and Andrew Williams became part of the firm’s leadership team and share management and staff development responsibilities as owners and partners.

Brown now leads the Grand Rapids-based firm’s investment banking and advisory practice. Williams heads the northern Indiana office in Mishawaka with a focus on investment banking and capital for clients in furniture and manufacturing.

In making the promotions, President and Managing Director John Kerschen adds two owner/partners to the business as Charter Capital Partners looks to expand further into new practice areas and geographies. Brown and Williams have steadily been assuming more leadership responsibilities in recent years, “and this is a continuation of that process,” Kerschen said.

“It’s really about growing the business,” he said. “The guys have been not just dedicated but talented contributors to the success that we’re having and it’s time for them to come into ownership and assume more leadership. It’s also an opportunity for them to share that responsibility with me and allows me to kind of keep looking for new opportunities to continue growing our firm.” more

Investment banking firm advises on UK deal

August 25, 2017 - Grand Rapids Business Journal

The Grand Rapids-based investment banking firm Charter Capital Partners said yesterday that London-based ACM Group, or Alpha, whose management team works out of Grand Rapids, has agreed to sell technology, intellectual property and customer assets to the London-based gaming company Playtech. Charter Capital Partners assisted Alpha with the transaction.

The acquisition includes an up-front payment of $5 million, two staged payments based on the EBITDA of 2017 and 2018 and contingent consideration based on a 5.2 multiplied 2019 EBITDA, with total consideration capped at $150 million.

“We are pleased to be part of the Playtech family,” Alpha CEO Muhammad Al-Amin Rasoul said. “Their understanding of our business, married with their financial strength is a perfect fit for us. Most importantly, we will be able to better serve both companies clients with the additional capabilities afforded by this transaction.”

Dale Grogan, managing director of Charter Capital Partners, said Alpha is an "excellent example of the great businesses that are built in Grand Rapids. The entire Alpha team, based literally all over the globe, represents the very best in business diversity, led by a dynamic Grand Rapids leadership team." more

Partners produce event on transitioning family businesses

July 5, 2017 - Grand Rapids Business Journal

A local investment banking firm is co-hosting a business planning seminar focused on continuing the success of family businesses across generations.

Charter Capital Partners has partnered with BDO and Miller Johnson to host Mapping the Legacy of Your Family Business on July 25 at GVSU’s L. William Siedman Center in Grand Rapids, at 50 Front St. SW.

The seminar will take place from 3:30-5 p.m. in the Loosemore Forum, room 1008.

Doors for the seminar open at 3 p.m. for appetizers and networking opportunities. Attendees are required to register prior to the event at creatingalegacy-grandrapids.eventbrite.com.

The seminar will center on how to transition a family owned business across multiple generations, with discussions on common misconceptions about gifting a business, what to ask when developing a succession plan, opportunities to build a family succession solution and wealth protection strategies.

Business expert Tom Deans, who authored “Every Family’s Business,” will present at the seminar, which will include a panel discussion from Charter, BDO and Miller Johnson industry professionals. more

Charter Earns Best and Brightest Recognition

bestandbrightest.png

Charter Capital Partners was recognized today as one of West Michigan’s 2017 Best and Brightest Company to Work For® at an awards ceremony taking place at the JW Marriott in Grand Rapids, Michigan. This award honors companies that display a commitment to innovative human resource practices and employee enrichment. Organizations are assessed based on various categories such as communication, work-life balance, employee education, and more. 

Charter was recognized for placing a high priority on work-life balance. In an assessment report provided by the sponsor organization, Charter was also positioned in the top 15% of recognized companies in the category of Strategic Company Performance, based on the firm's collaborative approach to proactively driving performance across all levels of the organization.

"Our strategic planning process involves every team member, for shared accountability, and is backed by a bonus system that enables all employees to share in the rewards of a job well done,” said John Kerschen, managing director. “The team we’ve built is the backbone that makes Charter a great place to work, and we are honored to be recognized as one of West Michigan's best and brightest companies to work for.”

For the complete list of West Michigan winners, visit the 101 Best and Brightest website.

Investment banking firm named to 'Advisor 100'

April 4, 2017 - Grand Rapids Business Journal

A local investment banking firm has been named one of the most-referred middle-market advisors in the nation by its peers. Grand Rapids-based Charter Capital Partners was included in Axial’s inaugural 2017 “Advisor 100” ranking. Axial, a network comprising investors, advisors and CEOs, chose the winning firms by surveying 1,000 private equity firms, strategic acquirers and family offices.

Charter was one of three firms in the state to earn the designation, joined by Birmingham-based Finnea Group and Detroit-based Quarton International.

“We are honored that our clients and colleagues felt we were worthy of recommending to be included in this impressive list of firms located throughout the country,” said John Kerschen, managing director, Charter Capital Partners. “Being named as one of the Axial ‘Advisor 100’ confirms that our expertise in meeting the M&A needs of our clients is not going unnoticed.” more

Charter Capital Partners named in Axial's Top 100 Advisors

March 30, 2017 - Yahoo Finance

Charter Capital Partners, a Grand Rapids, Mich.-based investment banking and capital management firm, today announced that it has been included in Axial's 2017 Advisor 100 List for most referred middle-market advisory firms in the United States, according to a survey of 1,000 private equity firms, strategic acquirers, and family offices.

According to the Axial, "We set out to find the very best middle market M&A advisory firms and investment banks in the USA for 2017. We did not want to create this list from deal tables or subjective criteria of our own. The currency we were interested in was referrals. We went looking for recommendations from the very people who have worked both alongside and across the negotiating table from countless advisors."

Charter was the sole West Michigan representative and one of only three firms headquartered in Michigan to make the inaugural Axial Advisor 100 list. The firm serves the middle market from four offices in the Midwest, utilizing a client-focused, collaborative approach to meet client needs in a wide range of investment banking transactions.

"We are honored that our clients and colleagues felt we were worthy of recommending to be included in this impressive list of firms located throughout the country," said John Kerschen, managing director. "Being named as one of the Axial Advisor 100 confirms that our expertise in meeting the M&A needs of our clients is not going unnoticed." more

Crystal Flash acquires Southeast Michigan fuels distributor

March 8, 2017 - MiBiz

Fuel distributor Crystal Flash Inc. has expanded its geographic footprint into Southeast Michigan with a new acquisition, its tenth since 2011.

The deal for the Adrian-based Lenawee Farm Bureau Oil Cooperative includes more than 500 customers. Two employees will stay on with Grand Rapids-based Crystal Flash, according to a statement.

Lenawee County Farm Bureau Oil Cooperative serves agricultural, commercial, construction and home heating oil customers.

Grand Rapids-based Charter Capital Partners served as financial adviser to Crystal Flash on the deal. more

Crystal Flash acquires Richardson Oil of Southwest Michigan

January 4, 2017 - MiBiz

Crystal Flash has acquired Richardson Oil LLC in a move that will expand the company’s footprint in Southwest Michigan. Lawrence-based Richardson Oil distributes a variety of fuel including diesel, gasoline and kerosene. Crystal Flash, a fuel distribution company based in Grand Rapids, will add over 350 new customers and four employees as a result of the deal.

 Grand Rapids-based Charter Capital Partners advised Crystal Flash on the transaction. The firm has advised Crystal Flash in the acquisition of nine companies since 2011. Crystal Flash employs 250 people across 14 locations in Michigan. In May 2016, the company was purchased by its employees via a leveraged employee stock ownership plan (ESOP).

 “Our transition to an employee stock ownership plan earlier this year allows us to offer employees who join us through an acquisition a true path to ownership,” said President Tom Olive. Olive, who joined Crystal Flash in 2015 to take over for former company president Tom Fehsenfeld, believes that the company’s status as an ESOP will “be an attractive option for business owners looking to transition into retirement or a next chapter.” more

Ferguson acquires Indiana distributor

November 28, 2016 - Supply House Times

Ferguson Waterworks recently acquired Underground Pipe & Valve in an asset transaction completed in mid-November. Charter Capital Partners served as financial advisor to Underground Pipe & Valve.

Headquartered in South Bend, Ind., Underground Pipe & Valve has been in business for nearly 40 years and offers a full line of water and sewer products through its four locations in Indiana and Michigan. The acquisition complements the new Ferguson Waterworks locations from the recent acquisitions of Michigan Pipe & Valve – Lansing, Michigan Pipe & Valve – Flint and Michigan Meter Technology Group.

“Growing our brick-and-mortar locations is an integral part of our growth strategy, and our recent waterworks acquisitions in the upper Midwest will position us a true competitor in the local market,” Ferguson CEO Frank Roach said. “We are pleased to welcome Underground Pipe & Valve’s associates to Ferguson.”

Underground Pipe & Valve owner Don Nuner added: “While we have been successful as an independent distributor for some time, we are excited about the chance to become part of the Ferguson family. We feel Ferguson brings added value to our customers and good long-term opportunities for our employees.”

Ferguson Waterworks, a division of Ferguson Enterprises, has more than 200 locations and 2,000 dedicated Waterworks associates. more

California PE firm acquires majority stake in Motion Dynamics

September 13, 2016 - MiBiz

Medical device supplier Motion Dynamics Corp. has received a major capital investment from a Los Angeles-based private equity firm to support growth.

Vance Street Capital took a majority position in Motion Dynamics, a manufacturer of small metal components and sub-assemblies used in disposable medical devices. The private equity firm specializes in medical, aerospace and defense investments. The firm provides not only needed capital but expertise and networks within the medical device industry that Motion Dynamics can tap to enter new markets and secure additional customers.

“It was really done to help us expand in the medical device arena and help us expand in some markets that we’re currently not in that they have experience with,” said Chris Witham, the second-generation CEO of Motion Dynamics. “We want to go farther upstream, and that requires manufacturing capabilities that we currently don’t have in-house, and don’t have the network of customers.”

Witham — whose father, Dick, started Motion Dynamics in 1992 — retains a minority but “significant portion” of the company and continues as CEO. The company’s management team also remains intact and the business will “absolutely” remain in Fruitport, he said.

Charter Capital Partners in Grand Rapids and Miller, Johnson, Snell & Cummiskey PLC served as financial and legal advisers to Motion Dynamics. more

Motion Dynamics Corporation Announces Strategic Partnership

September 12, 2016 - PR Newswire

Motion Dynamics Corporation, a Fruitport, Mich.-based manufacturer of custom wire components for the medical, electronics, aerospace and military markets, today announced its strategic partnership with Vance Street Capital, a Los Angeles-based private investment firm.

Motion Dynamics manufactures some of the smallest and most difficult wire components in the world. The company focuses primarily on the design, engineering, production and assembly of high quality wire components and sub-assemblies for medical device applications.

"Our company has achieved significant growth and performance since its inception, and we have been seeking the right opportunity to significantly accelerate that growth and take our performance to an even higher level," said Chris Witham, president of Motion Dynamics. "Given this strategy, we believe that now is the ideal time to bring in a strategic investor to deliver on our business goals, and Vance Street Capital, with over two decades of experience and a proven track record, is the right partner to help us achieve that next level of growth."

Vance Street Capital is a private investment firm which primarily invests in middle-market businesses that are established leaders in providing highly engineered solutions for niche markets in the aerospace, defense, industrial and medical sectors.

Motion Dynamics was advised throughout the transaction process by Charter Capital Partners, exclusive financial advisor in the transaction. Principals of Charter Capital Partners acted on behalf of the company in their capacity as licensed investment banking agents of M&A Securities Group, Inc. Miller Johnson served as legal advisor.

"We worked closely with Chris to identify the best match to continue his vision of the company," said Jason T. Byrd, managing director at Charter Capital Partners. "With its unmatched expertise in providing strategic support and investment capital to companies in the medical and aerospace operations, Vance Street Capital presents a unique ability to assist current leadership in further enhancing the company's robust growth."

Chris Witham and the existing management team will continue to lead the company. more

Charter advises Kentucky furniture manufacturer in deal with PE firm

August 28, 2016 - MiBiz

An investment banking adviser believes the current environment in the contract furniture industry should lead to more deals getting done before the end of the year. Andrew Williams, a director at Charter Capital Partners and head of the firm’s national contract furniture industry practice, said the sector mirrors what’s going on in other industries. “Contract furniture is no different than the broader North American economy with a lot of baby boomers identifying a succession plan in their businesses,” Williams told MiBiz. “There are certainly more deals to come yet this year.”

Williams served as lead on the transaction advisory team for Louisville-based KFI Seating, which last week announced a deal with Weller Equity Partners, also of Louisville. In the deal, two of the company’s owners looked for an equity partner to buy out a third owner who was looking to retire, as well as give the firm resources to grow, he said. The three co-owners were “able to achieve their financial and personal goals” and allow the two partners to remain with the company after the deal. 

As the company went to market, it garnered “significant interest” from strategic investors and private equity firms alike, Williams added. The response to the KFI deal was emblematic of the capital chasing opportunities in the broader industrial sector, said Williams, who has long ties to contract furniture. “In contract furniture, M&A remains very healthy with too much capital chasing … deals out there,” he said, adding that since the KFI deal was announced, he’s already received calls from other prospects. 

Charter Capital, which also operates two Indiana-based offices in South Bend and Indianapolis, first connected with KFI Seating during the 2015 NeoCon contract furniture trade show in Chicago. The company, which manufactures seating and table products, had looked at another deal Charter was representing at the time and stayed in contact, according to Williams. “With our roots in Grand Rapids and our contacts across the country, we’re working on projects all over the U.S.,” he said.

Charter Capital formed the contract furniture practice in 2013, announcing it at that year’s NeoCon. Since then, the firm has worked on deals involving all three levels of the industry, including OEMs, suppliers and distributors. The company represented Interphase Interiors, Sauder Manufacturing, The Worden Co., and Bold Furniture on recent transactions. more

Weller Equity Partners Acquires KFI Seating

August 22, 2016 - PR Newswire

Weller Equity Partners (Weller), a Louisville, KY-based private equity firm, today announced that it has acquired KFI Seating (KFI), a Louisville, KY-based leading supplier of business and institutional furniture products. The acquisition closed on July 29, 2016.

"We have been looking for an experienced partner to help us replace a retiring co-owner and key executive, while keeping our sights fixed on the continued growth and development of our business," said Chris Smith, president of KFI. "We feel very comfortable with our new partnership with the Weller team, especially considering we are both based in Kentucky," added KFI Chief Operating Officer Scott Williamson.

According to Ken Berryman, managing partner of Weller, "The KFI transaction is a classic fit for Weller as we look to partner with existing management teams to provide liquidity for shareholders, capital for growth, and organizational development to help businesses achieve their full potential."

KFI was represented by Charter Capital Partners, with Andrew Williams, director, leading the transaction advisory team. "A key component of the transaction's success was making sure everyone's interests were aligned," commented Williams. "The transaction was designed so that each co-owner of KFI was able to achieve their financial and personal goals, while providing the company with a strategic partner to propel future growth. It was a win-win for all parties."

Additional advisors to Weller included Frost Brown Todd (legal) and BKD (financial). more

Louisville equity firm acquires local furniture company

August 22, 2016 - Louisville Business First

Weller Equity Partners, a Louisville-based private equity firm, has acquired the Louisville-based furniture supplier KFI Seating. The acquisition closed July 29. Weller Equity invests in lower middle-market companies ($5 million to $50 million in revenue) in the Mid-South region of the U.S. The firm provides funding structures and private equity expertise to a company's owners, particularly in the manufacturing, health care, information technology and food and beverage industries.

"We have been looking for an experienced partner to help us replace a retiring co-owner and key executive, while keeping our sights fixed on the continued growth and development of our business," Chris Smith, the president of KFI, said in a press release.  Scott Williamson, the chief operating officer at KFI, said that he is comfortable with the partnership with Weller, because both companies are based in Louisville.

"The KFI transaction is a classic fit for Weller as we look to partner with existing management teams to provide liquidity for shareholders, capital for growth and organizational development to help businesses achieve their full potential," Ken Berryman, the managing partner at Weller Equity, said in a press release.

The financial details of the deal were not disclosed. KFI was represented by Charter Capital Partners, with director Andrew Williams leading the advisory team. more

Lawsuit questions legality of Herman Miller's Acquisition of Design Within Reach

June 10, 2016 - MiBiz

Herman Miller Inc.’s highly praised $154 million acquisition in 2014 of high-end furniture retailer Design Within Reach Inc. may not legally have occurred. That’s according to a pair of former Design Within Reach (DWR) shareholders who filed a lawsuit in December 2014 against the company’s current and former owners. The lawsuit alleges the company violated Delaware law in how it executed a 1-for-50 reverse stock split, a move that predated its acquisition by Herman Miller.

While plaintiffs Andrew Franklin and Charles Almond name Herman Miller in the lawsuit, the pair appear to be using the office furniture manufacturer as leverage to put pressure on the former majority shareholders of DWR, according to a lawyer who spoke to MiBiz and asked not to be named in this report. The lawyer described the lawsuit as an “unusually messy situation.” For one, if the reverse stock split did not occur from a legal standpoint, it means Herman Miller purchased far fewer shares than was required to complete the 2014 acquisition of DWR under Delaware law, making the transaction null, according to multiple sources.

High-profile acquisitions can often bring about lawsuits from unhappy shareholders, but this deal appears to have some unique characteristics, said Christine Baker, managing director of business valuation services at Grand Rapids-based Charter Capital Partners. “I’ve heard of dissenting shareholder suits not infrequently,” Baker said. “But someone asserting that the deal never actually closed is a new one to us, especially for companies that have to report so much in a public way. That’s kind of stunning.” more

ADDITIONAL