New York, NY (July 1, 2003) -- KPS Special Situations Fund II announced today that it has completed the acquisition out of bankruptcy of the assets of Wire Rope Corporation of America, Incorporated for approximately $53 million in assumed debt and $1.5 million in cash. KPS acquired the assets through a newly formed company, which has been renamed Wire Rope Corporation of America, Inc.
Based in St. Joseph, Missouri, WRCA is the nation's leading producer of high carbon wire and wire rope products and is the largest domestic supplier of wire rope products to the mining, oil and gas, construction and steel industries. With 915 employees, WRCA operates four manufacturing facilities and seven distribution centers across the country. KPS has formed a new senior management team under the leadership of Ira Glazer, the newly appointed Chief Executive Officer and former Chief Restructuring Officer of WRCA. Eric Bruder has been named Senior Vice President of Manufacturing and John Josendale has assumed the position of Senior Vice President of Sales, Marketing and Fabricated Products.
KPS will make $16.5 million of capital investments in WRCA, including a $14 million equity investment and a $2.5 million secured loan, to fund working capital requirements as the Company continues to execute its restructuring program. In addition, KPS has successfully renegotiated and extended approximately $50 million in WRCA credit facilities, including a $35 million senior lending facility with HSBC USA and secured loans by Citizen’s Bank and Trust of Chillicothe, Missouri and Amsted Industries.
Mr. Ira Glazer, Chief Executive Officer of WRCA, said: “We are pleased to have emerged from bankruptcy as a market leader with so many exciting prospects in front of us. The capital and turnaround expertise of the KPS team were instrumental in taking this company out of bankruptcy and creating a new WRCA with a clean balance sheet and unlimited prospects for the future. We are thrilled to have the ongoing commitment of KPS as we continue our efforts to build our position as the premier supplier of wire rope products in North America."
The KPS Special Situations Funds are a family of private equity funds focused on constructive investment in distressed companies, restructurings and other special situations in partnership with employees and senior managers. KPS has purchased operating assets out of bankruptcy; established stand-alone entities to operate divested assets; and recapitalized highly leveraged public and private companies through equity infusions.
KPS’ investment strategy targets companies with strong franchises but which are experiencing operating and financial problems. KPS invests its capital concurrently with a turnaround plan predicated on cost reduction, capital investment, capital availability, and in most situations, the introduction of new management. The operational turnaround plan is accompanied by a financial restructuring of the company’s liabilities, either in or out of bankruptcy. KPS often works constructively with unions and employee groups to effect immediate change. The KPS investment strategy and portfolio companies are described in detail at www.kpsfund.com.
About KPS Capital Partners
KPS, through its affiliated management entities, is the manager of the KPS Special Situations Funds, a family of investment funds with approximately $21.4 billion of assets under management (as of December 31, 2023). For over three decades, the Partners of KPS have worked exclusively to realize significant capital appreciation by making controlling equity investments in manufacturing and industrial companies across a diverse array of industries, including basic materials, branded consumer, healthcare and luxury products, automotive parts, capital equipment and general manufacturing. KPS creates value for its investors by working constructively with talented management teams to make businesses better, and generates investment returns by structurally improving the strategic position, competitiveness and profitability of its portfolio companies, rather than primarily relying on financial leverage. The KPS Funds’ portfolio companies generate aggregate annual revenues of approximately $20.3 billion, operate 222 manufacturing facilities in 26 countries, and have approximately 48,000 employees, directly and through joint ventures worldwide (as of December 31, 2023). The KPS investment strategy and portfolio companies are described in detail at www.kpsfund.com.
