G2 Capital Advisors announced today that its client ITOCHU International Inc. (‘ITOCHU’ or the ‘Company) and its subsidiary Enprotech Corp has entered into a definitive agreement to acquire American Hydro, a Wärtsilä Corporation business.
American Hydro is a leading North American provider of custom hydropower refurbishment solutions and turbine services. The Company leverages world-class advanced engineering, precision machining, large fabrication, and field services capabilities to power North American hydroelectric production.
Victoria Arrigoni, Managing Director & Head of Industrials and Manufacturing at G2 Capital Advisors commented “It has been an honor to be a part of expanding ITOCHU’s footprint in the hydropower and renewables market. The opportunity for ITOCHU to expand to the hydropower space is a pivotal moment for their machinery division’s go-to-market strategy.”
The addition of American Hydro to ITOCHU’s portfolio of businesses will expand industry segmentation into the renewable energy sector and position the organization to become a leading North American maintenance, repair, remanufacture and optimization solutions provider for heavy-industrial machinery and equipment.
The transaction is subject to regulatory approvals and is expected to close in the first half of calendar 2023.
G2 Capital Advisors is pleased to present its Industrials & Manufacturing industry update for Q3 2022, providing commentary and analysis on M&A and market trends within the Industrials & Manufacturing sectors.
A historic, $1.2T of funding has been approved to invest in aging infrastructure nationwide through the Infrastructure Investment and Jobs Act (“IIJA”), coupled with additional investment of $52B through the CHIPS Act and $700B through the Inflation Reduction Act. Construction services firms have been buoyed by the news of the injections, promising years of bumper backlogs and a reliable end customer in the U.S. government. Unfortunately, new investment can’t conjure up a much-needed base of skilled laborers, as the war for talent rages on. Only 80% of the 1MM construction workers who lost their jobs at the beginning of the pandemic have returned, in the face of an estimated 1MM additional workers required in the near term to keep up with high demand. Firms have been forced into bidding wars and are providing more clearly defined career trajectories to attract new workers. As the U.S. hovers over a recessionary state, pressure on wage growth should ease more broadly, but will likely remain an acute issue for the construction services industry as demand is supported by government policy. With spending under the infrastructure law expected to peak in 2027-28, the labor strain is set to become a longer term, structural issue.
The $700B Inflation Reduction Act includes a rejuvenated solar power incentive, increasing the existing tax rebate from 26% to 30% for a period of ten years through 2032. Originally scheduled to phase out between 2020 and 2023, the reboot will be partially financed by a 15% alternative minimum tax on some large U.S. corporations and a 1% excise tax on certain corporate share repurchases. The Biden administration aims to further increase investment and development of renewable energy alternatives, providing a significant boon to developers and investors. This backdrop of robust demand has allowed firms to pass inflationary pressures on to end customers, offsetting the impact on their businesses.
While demand for the construction services and renewable energies sectors will remain robust, supported by extraordinary government funding, industry players will need to combat persistent labor shortages likely to endure through a forecasted recession.
G2 Capital Advisors, LLC (“G2”), a leading full-service investment bank and restructuring advisory firm, announced today that Jim Cotter has been hired as a Managing Director on the Industrials & Manufacturing M&A Team, reinforcing the firm’s coverage in industrial technology.
“With more than 25 years of experience in industrials investment banking, Jim’s hiring underscores G2’s commitment to investing in top talent as we continue to grow our platform,” said Matt Konkle, President of G2 Capital Advisors. “In addition to his deep expertise in Industrials, Jim has also worked to source and execute transactions within the Media, Entertainment, Telecommunications, Transportation, and Gaming industries.”
Cotter joins G2 having most recently served as a Managing Director at SunTrust Robinson Humphry for over a decade, where he was the Co-Head of their Industrials M&A group. During his tenure, Jim advised scores of clients across multiple sectors leading efforts to execute strategic transactions for various public and private companies. Before SunTrust, Jim held senior advisory roles at JPMorgan, Jeffries, and CIT Capital. Jim’s advisory experience covers healthy growth company engagements and special situations.
“As we continue to invest and grow our presence in the industrials sector, we’re delighted to welcome Jim, who brings extensive experience across the Industrials and Communications sub-sectors and a proven track record in mergers and acquisitions, strategic corporate development, and special situations,” said Victoria Arrigoni, Head of Industrials & Manufacturing M&A, “With this hire the G2 Industrials & Manufacturing team continues to expand our transaction capabilities and further build on our mission to help clients achieve their strategic and financial goals.”
“G2’s platform is ideally positioned at the forefront of investment banking and restructuring advisory services to the industrials & manufacturing industry. I am thrilled to join the practice and look forward to partnering with the exceptional team assembled under Victoria Arrigoni’s leadership,” said Jim Cotter, Managing Director.
G2 Capital Advisors’ Industrials & Manufacturing team has significant M&A and capital markets experience, which brings deep and relevant knowledge and insight to clients. The firm offers comprehensive and complimentary advisory capabilities through industry experts and M&A bankers that bring expertise across subsectors, geographies, and deal structures.
To learn more about G2’s Industrials & Manufacturing investment banking practice, visit:https://g2capitaladvisors.com/industry-expertise/industrials-manufacturing/
VP – Head of Marketing
Andler Packaging Group (“Andler Packaging” or the “Company”) is a value-added distributor of plastic, glass, and metal packaging products. Founded in 1893 by Israel Andler in Cambridge, Massachusetts, the Company was originally a recycler of glass bottles for the local community. With multiple locations across Massachusetts, New Jersey, Maryland, and Florida and 130 years of operational experience, Andler Packaging is one of the largest packaging suppliers in the United States. The Company serves a variety of markets, with expertise in the rapidly growing pharmaceutical and nutraceutical industries. Andler also offers value-added services, including proprietary custom tools, printing and labeling capabilities, and repacking and sterilization services.
As a leading value-added provider of packaging solutions and a 4th generation family-owned business, Andler was approached regularly with strategic discussions regarding exit opportunities. After much consideration, the Company decided to engage an advisor to support the exploration of its options, including a possible sale process with a select list of strategic parties. “Supporting the Andler Family in evaluating and refining their family and personal goals was a highly collaborative process. Together we were able to identify the best path forward and deliver maximum value with an optimal long-term partner,” said Pat Reinhardt, Managing Director at G2 Capital Advisors.
G2 Capital Advisors, LLC (“G2”) served as the exclusive sell-side advisor to Andler Packaging Group in its sale to Berlin Packaging. Through a fast-paced and collaborative process, G2 focused on identifying the right partner and deal structure to ensure the family and employee legacy would be maintained and realize maximum value for the brand and enterprise.
“Working with G2 was a great experience for all our stakeholders. They were knowledgeable and responsive and helped us not just maximize value but find a partner we could feel truly good about taking on our family’s business and legacy. We enjoyed working with G2 and are excited to watch this next chapter of our business unfold,” the Andler family said of the process.
G2 successfully led the Andler Packaging organization through an accelerated strategic process that achieved our clients’ primary goals and ultimately led to its acquisition by Berlin Packaging, a leading global supplier of packaging services and solutions.
“It has been an honor to be part of preserving the generational legacy of Andler Packaging. G2’s expertise in working with family-led businesses in the middle market, such as Andler Packaging, allowed for a great outcome across all family stakeholders by deploying our deep operational and transactional industry expertise. There were several elements of unique complexity based on the 130-year company history and complex, multi-generational, and multi-family ownership,” said Victoria Arrigoni, Managing Director & Head of Industrials & Manufacturing M&A at G2.
“We have a longstanding relationship with Berlin Packaging, not only as a competitor but also as a customer and supplier,” said Sam Andler, Managing Director of Andler Packaging Group. “Berlin Packaging’s values and dedication to customer thrill make this an excellent partnership. I look forward to continued growth for our Company and our employees.”
G2 Capital Advisors provides M&A, capital markets, and restructuring advisory services to the middle market. G2 offers integrated, multi-product, and sector-focused services by pairing highly experienced C-level executives with specialist investment bankers. G2 aspires to be our clients’ trusted advisor of choice, including corporations and institutional investors.
Cyberattacks: A potent reminder of technological vulnerabilities in the age of automation.
High profile cyberattacks are a potent reminder of growing technological vulnerabilities as manufacturers implement higher levels of automation. Adoption of “Industry 4.0” technology infrastructure is increasing the attack surface to include legacy systems not designed to defend against today’s sophisticated cyber criminal or rogue nation. Ransomware can trigger financial losses, but disruption to production and supply chains can cause harm beyond the initial shake-down. Breaches such as the Colonial Pipeline and SolarWinds attacks grab headlines and underscore the need to defend operations and silo production networks from companies’ external facing business networks. In response, manufacturers should audit not only their existing cyber defenses, but also the resiliency of their operations in the event of a cyber attack.
Cybersecurity plays a vital role in M&A strategy and execution. Firms considering a transaction should understand risks present in the form of data leaks, ransomware, and opportunities for malicious actors to use a transaction as a way to break into an acquiring company. According to IBM, more than half of companies wait until due diligence is completed to perform cybersecurity assessments. Considerations surrounding data privacy regulations, mandatory disclosure laws, and the risk of business interruption should be a priority for sellers and acquirors from the early stages of the transaction process.
Cibes Lift Group is one of the world’s most innovative manufacturers of space-saving lifts designed for fast and easy installation, also offering a wide range of conventional lift solutions. Thanks to the wide range of lift products and a flexible design concept, the lift solutions of Cibes Lift Group adapt to the requirements of public, commercial, and private settings. Sales, installation, and maintenance services are provided by a global network of subsidiaries and partners. The company group is headquartered in Gävle, Sweden, and has production facilities in Sweden and China. In 2021 the Group had approximately 1200 employees and a revenue of 1.9 billion SEK.
In Europe and Asia, Cibes established its reputation as a premium vertical platform lift manufacturer serving primarily residential customers and experienced substantial growth. To compound on its global reach, the company entered the United States market in 2020 by establishing a state-of-the-art showroom in the Miami metropolitan area. Cibes looked to apply its successful M&A track record in Europe to bolster its growth in the United States by acquiring new customers, capabilities, and geographic markets.
G2 Capital Advisors, LLC (“G2”) served as the exclusive buy-side advisor to Cibes, leading a bespoke buy-side effort focused on identifying and engaging with American companies that have a strong market presence and operations within residential elevator markets.
G2’s mandate with Cibes began in 2021 and led to a successful acquisition of American Elevator of Atlanta (“AEA”), followed this month by the acquisition of Bella Elevator LLC, manufacturer of Symmetry Elevating Solutions (“Bella” or “Symmetry”). The acquisition secures a manufacturing center for Cibes in the United States and further establishes its U.S. presence after its 2021 acquisition of AEA. Symmetry adds local manufacturing capabilities, an enhanced home elevator and accessibility product portfolio, and an increased reach in the U.S. and Canada through a robust 80-location distributor network. Bella will remain in operation and work in tandem with Cibes to promote the Cibes and Symmetry brands across the U.S.
Per Lidström, CEO of Cibes Lift Group, commented “I am excited to add Bella and Symmetry to our U.S. arm and Cibes family. We entered the United States with a high level of excitement for adding domestic manufacturing capabilities and are grateful for the work G2 did to promote our relationship with Bella. We are pleased with the work G2 dedicated to this acquisition to help share our culture, goals, and vision with Bella. We look forward to having Bella on board as a key contributor to that vision.”
“The G2 team is thrilled to help welcome Bella and Symmetry to the Cibes team. Symmetry has an exceptional brand name and reputation in the U.S., adding to Cibes international acclaim in the residential elevator space. Its manufacturing capabilities will be instrumental to bringing the full Cibes product suite to the U.S. and will add a significant product expansion to its world-class offerings. We are excited to continue supporting Cibes’ U.S. strategy and look forward to seeing the company’s continued growth.” said Peter Reed, Director at G2.
About G2 Capital Advisors
G2 Capital Advisors provides M&A, capital markets and restructuring advisory services to the middle market. We offer integrated, multi-product and sector-focused services by pairing highly experienced C-level executives with specialist investment bankers. We aspire to be the trusted advisor of choice to our clients including corporations and institutional investors.
CONTACTS ON THIS DEAL:
Peter Reed, Director, Head of Buy-Side: T: 617.918.7972 E: [email protected]
Aaron Levy, Associate: T: 857.250.2767 E: [email protected]
Ben Stevenson, Associate: T: 857.317.2785 E: [email protected]
Jeremy Caulkins, Analyst: T: 857.317.2790: E: [email protected]
Biotron Laboratories, LLC (“Biotron”) and Talus Minerals Company (“Talus”), collectively (“the Company”), is a leading producer of premium, food-like speciality minerals and customized mineral solutions serving the nutrition supplement industry. The Company serves a diverse mix of customers that span the globe and provides exceptional service and high-quality products to the greater nutritional and dietary ingredients markets. Headquartered in Ogden, UT, the Company operates with a deeply ingrained, service-first culture.
Biotron and Talus, longstanding leading producers of specialty mineral chelates and complexes serving customers globally, organically built a highly scalable platform with premium products and a customer-driven approach. As part of the Companys’ long-term growth strategy, management sought a strategic partner to support its continued growth and expansion.
G2 Capital Advisors, LLC (“G2”) was engaged by Biotron and Talus as its exclusive sell-side advisor. G2 led a highly targeted, strategic, and efficient sell-side transaction process focused on identifying the right partner for the Company to further accelerate the growth of the platform.
In March 2022, the transaction was successfully executed through a sale to Aceto, the provider of choice for differentiated specialty ingredients in the life sciences and advanced technology end markets. Aceto is a portfolio company of New Mountain Capital.
“Through this process with G2 we’ve learned more about the inner workings of our own business than we imagined was left to learn. We leaned on their team for insight and advice and were introduced to a broad array of qualified parties. With the support of G2’s team of seasoned experts we achieved an outcome that exceeded our expectations. Via G2 we have found in Aceto the right fit for ensuring continued success and a growth platform for our business, our customers, and our team,” said Gameil Fouad, PhD, President, Biotron Laboratories, LLC.
“The partnership between the Company and Aceto will continue to fuel the growth of its platform and allow for the expansion of their commercial reach on an accelerated timeline. We are thrilled to have led our client through a successful transaction and are excited to watch these two groups continue to flourish in this new partnership,” said Victoria Arrigoni, Managing Director and Head of Industrials & Manufacturing at G2 Capital Advisors.
G2 Capital Advisors provides M&A, capital markets, and restructuring advisory services to the middle market. We offer integrated, multi-product and sector-focused services by pairing highly experience C-level executives with specialist investment bankers. We aspire to be the trusted advisor of choice to our clients including corporations and institutional investors. For more information, visit www.g2cap.com
ABOUT BIOTRON LABORATORIES AND TALUS MINERAL COMPANY:
Biotron Laboratories and Talus Mineral Company, founded in 1979 and 2014, respectively, are affiliated entities that in partnership manufacture and supply leading speciality minerals and nutritional ingredients to global markets. Biotron provides clients excellent customer service, agile processing capabilities, and proprietary production methods to deliver the highest quality ingredients with speed and certainty. The Company provides over 250 products including mineral complexes, custom blends, fortified blends, and chelates, which include magnesium-based, zinc-based, calcium-based and iron-based products. Products include halal, kosher, vegan and organic certified options. The Company’s manufacturing operations are located in Centerville, Utah and Ogden, Utah. For more information visit www.biotronlabs.com and www.talusminerals.com
Aceto is the provider of choice for differentiated specialty ingredients in the life sciences and advanced technology end markets. With business operations in 10 countries, Aceto manufactures and supplies more than 3,000 chemical compounds used principally by the pharmaceutical, nutraceutical, agricultural, and specialty chemical industries. In the last two years, Aceto has made seven acquisitions including Biotron, which has expanded its manufacturing, R&D, and portfolio offerings, transforming the company into a worldwide supplier of critical ingredients with a robust manufacturing footprint. Aceto’s global operations, including a significant presence not eh ground in China, India, Europe and North America, enable the companys’ deep worldwide sourcing and regulatory capabilities. Aceto is well positioned to innovate new solutions, ensure quality and customize products to meet customers’ specific needs. Its expanded capabilities and decades of global sourcing expertise are especially valuable now that supply chain management is a critical strategic issue for companies worldwide. For more information visit, www.aceto.com
CONTACTS ON THIS DEAL:
Victoria Arrigoni: MD, Head of Industrials & Manufacturing, T: 781.604.9005 E: [email protected]
Mike Williams: Director, Industrials & Manufacturing, T: 917.523.2164 E: [email protected]
Noah Johnson: Sr. Analyst, T: 717.598.8558 E: [email protected]
Ted Malpiede: Sr. Analyst, T: 781.752.6001 E: [email protected]
Matt Ball: Sr. Associate, T: 978.914.4421 E: [email protected]
Carbon Capture: The Future or a False Start?
Environmental, Social, and Governance (“ESG”) investing has established itself as a serious investing niche, with global sustainability fund assets almost doubling over the past six months through September to $3.9T. Encouraged by regulators worldwide eager to show their commitment to tackling wide-ranging equality and environmental issues, investors and companies alike are investing and marketing themselves as responsible and sustainable corporate citizens. Enter carbon capture, while high hopes for CCUS (Carbon Capture, Utilization, and Storage) technologies over the past decade have been a litany of false-starts and delays, this time may be different.
In this newsletter, we will demonstrate the impact of renewed investment and focus on CCUS applications for key Industrials and Manufacturing sectors and how the related M&A market has performed in the Q4 2021.
G2 Capital Advisors is pleased to present its Industrials & Manufacturing industry update for Q3 2021, providing commentary and analysis on M&A and market trends within the Industrials & Manufacturing sectors. We hope this report finds you and your families safe and healthy, we encourage you to contact us directly if you would like to discuss our perspective on the current market environment, trends, or our relevant industry experience.
Founded in 1971, The Granite Group Wholesalers, LLC (“The Granite Group” or “the Company”), serves New England residential and commercial contractors, providing exceptional service and products to plumbing, heating, cooling, water, and propane markets. Headquartered in Concord, NH, the Company’s best-in-class e-commerce and 45+ branch network is operated by expertly trained staff that offer an industry-leading customer experience. The Company serves a diverse mix of contractors and fuel dealers with a deeply ingrained, people-first culture, positioning the Company as one of the top building product distributors in the Northeast.
The Granite Group has long been one of the leading family-owned businesses in the Northeast. In the past few years, the Company has embarked on a strategic, thoughtful expansion across New England and within its e-commerce platform, increasing density in key markets and expanding its presence through organic branch openings and acquisitions. A meticulous approach to product line expansion has ensured strategic alignment with the Company’s customers and differentiated product knowledge. With its sustained growth, the family identified further opportunities to fast-track their vision with the right strategic growth partner.
G2 has served as a long-term strategic advisor to The Granite Group and as the exclusive financial advisor for this process, was responsible for leading a highly tailored and efficient transaction process for the family and Company.
The transaction was successfully executed through a growth investment by BBH Capital Partners (“BBHCP”) in the equity interests of The Granite Group. The family is retaining ownership, and Bill Condron, President and CEO of The Granite Group, will continue to lead the Company, using additional resources and expertise from BBHCP to execute on a shared vision of growth.
“G2 has been our trusted advisor and partner for many years, supporting the execution of family’s and the Company’s long-term vision. Throughout this process and the duration of our relationship, G2 has been a key strategic advisor, aligning with our people-first culture, and helping us define and execute the best possible outcome. G2’s deep knowledge of our business and industry, and vision for the potential of our platform was critical to the success of this process, along with their unique ability to guide the family through a major life event,” said Bill Condron, CEO of The Granite Group.
“The exciting partnership between The Granite Group and BBHCP will supercharge the robust growth of their platform and allow them to execute their strategic vision on an accelerated timeline. We are thrilled to have had the opportunity to lead our client through to a successful outcome,” said Jeffrey Unger, CEO of G2. “Our relationship with The Granite Group is a terrific example of our strategy of acting as an industry focused trusted advisor to innovative, high growth companies.”
The transaction will support the Company’s growth initiatives of expanding organic footprint and executing strategic acquisitions.
About G2 Capital Advisors
G2 Capital Advisors provides M&A, capital markets and restructuring advisory services to the middle market. We offer integrated, multi-product and sector-focused services by pairing highly experienced C-level executives with specialist investment bankers. We aspire to be the trusted advisor of choice to our clients including corporations and institutional investors. (www.g2cap.com)
CONTACTS ON THIS DEAL:
Jeffrey Unger, Chairman & CEO: T: 617.918.7929 E: [email protected]
Victoria Arrigoni, Managing Director, Industrials & Manufacturing: T: 619.742.6441 E: [email protected]