- change ups
Private equity firm acquires transformer manufacturer
A local private equity firm is investing in manufacturing at the lakeshore.
Grand Rapids-based Blackford Capital said today that it has acquired Grand Haven-based Grand Transformers, a maker of transformers and inductive components that supplies various industries such as energy, oil and gas.
Comerica Bank and Huntington Bank provided financing for the transaction.
Terms of the deal were not disclosed.
Blackford Capital acquires, manages and builds middle market manufacturing, distribution and service companies. It has six companies in its portfolio.
Grand Transformers is the third company in the firm's Michigan Prosperity Fund.
The fund, created in 2012, aims to generate “best-in-class equity returns” for investors in Michigan and support the local economy, "by protecting and creating jobs locally."
K.C. Retzlaff founded Grand Transformers in 1948.
The company was purchased from Retzlaff by his two sons, Greg and Jerry, in 1973 and employs 70 people at its 55,000-square-foot facility in Grand Haven.
The company specializes in supplying "highly engineered" custom products that meet the requirements of Fortune 100 OEMs.
"Grand Transformers' advanced engineering and lean manufacturing operations have made the company the market leader in its field," said Jeff Helminski, managing director of Blackford Capital. "We are honored that Greg and Jerry have entrusted their family legacy to our stewardship and are excited to work with the existing GTI management team to grow the company and create jobs in Michigan."
Blackford Capital will be implementing a board of directors and employing operating partners to support the management team and the growth of the business.
Ed Smith, Grand Transformers chief operating officer, will be promoted to CEO.
The company’s board will include a mix of members: Jeff Helminski, Blackford Capital managing director; Ed Smith, CEO, Grand Transformers; Wesley MacAllister, Blackford Capital operating partner and former vice president of manufacturing at Cascade Engineering; Shreedhar Shah, president of power systems engineering firm Shah and Associates; Robert Roth, president of transformer manufacturer RoMan Manufacturing, as well as others to be named at a later date.
All board members have strong ties to Michigan and "a depth of talent and expertise" to help the company grow.
Blackford Capital’s six portfolio companies employ more than 950 people and have combined revenues of approximately $225 million.
The firm, which has an office in Santa Monica, Calif., reviewed roughly 3,400 transactions in 2013 and has closed 26 transactions in the past seven years.
The firm invests in mature and profitable businesses, with revenues between $20 million and $100 million and management teams that are willing to remain with the company or seeking to retire.