New York, NY (September 10, 2007) -- KPS Capital Partners, LP (“KPS”) announced today that it has sold its portfolio company, Genesis Worldwide II, Inc. (“Genesis II”), which it jointly owned with Pegasus Partners II, L.P., to HVS Acquisition, Inc., an affiliate of Grey Mountain Partners, LLC. Genesis II is one of the world’s leading designers and manufacturers of high-quality metal coil processing equipment under the Herr-Voss Stamco® brand name, provides mill roll services, and operates a repair and spare parts business. Financial terms of the transaction were not disclosed.
The transaction represents the eighth sale of a portfolio company by KPS over the past 15 months. It is also the final sale of a portfolio company by KPS Special Situations Fund, L.P. and KPS Supplemental Fund, L.P., KPS’s first institutional private equity funds, which closed in 1998 with capital commitments of $210 million.
Michael Psaros, a Managing Partner of KPS and Chairman of Genesis’s Board of Directors since KPS and Pegasus acquired the company in 2001, stated, “Under our ownership, Genesis II became the leading company in its industry, developed and introduced the most advanced products in the world based on self-developed proprietary new technologies, and achieved recognition as the most recognized and admired brand name in North America. In addition, the company transitioned from a North American business into a global enterprise, with a substantial portion of its revenues now derived from exports to Asia, and Central and South America. The success of Genesis II is another validation of our investment strategy, and the culmination of a very successful investment campaign for our first fund.
“We congratulate Walter Stasik, Chief Executive Officer of Genesis II, and the company’s management team on their many accomplishments. We thank General Electric Capital Corporation for its strong support of the company and for financing the company’s important export business. We also thank the United Steelworkers and the International Association of Machinists and Aerospace Workers (“IAM) for their very critical role in making the company a success.”
Mr. Stasik added, “At the time of the original purchase transaction, KPS and Pegasus were the only investors that recognized the long-term value of this company. They were prepared to execute a very difficult two year restructuring and turnaround plan, and their patience and tenacity has been rewarded with this sale, and the prior sale of GFG. We thank KPS and Pegasus for providing us with the resources to achieve our objectives. We are now perfectly positioned to continue our growth, and expect long-term success under Grey Mountain’s ownership.“
IAM International President Tom Buffenbarger said, “Our members truly appreciate the decision in 2001 by KPS and its equity partner to keep high-skilled manufacturing in Pennsylvania. Genesis Worldwide II shows that a troubled company can become competitive again by working with its employees. This has been a success for the investors, management, the employees, and their community. In additional to creating job stability by growing the company together, our members and other employees also have a more secure retirement since Genesis Worldwide II contributes to the IAM National Pension Fund. We look forward to working with the new owners to keep this company going in the right direction.”
In November 2005, Genesis II sold its GFG subsidiary to Mitsubishi–Hitachi Metals Machinery, Inc. (“MH”), a joint venture of Mitsubishi Heavy Industries, Ltd. and Hitachi, Ltd. GFG is the world’s leading designer and manufacturer of roll coating equipment and lines, and electrostatic oilers under the Peabody name. MH was introduced to Genesis II and its GFG subsidiary by Mitsubishi International Corp., an investor in and key strategic partner of KPS.
Lincoln International acted as the financial advisor to Genesis II, and K&L Gates acted as the legal advisor with respect to this transaction.
About Genesis Worldwide II, Inc.
Headquartered in Callery, Pennsylvania, Genesis Worldwide II, Inc. (www.gen-world.com) designs, engineers and manufactures high-quality metal coil processing equipment through its Herr-Voss Stamco business unit. The Company also provides mill roll reconditioning, texturing and grinding services in addition to its rebuild, repair and spare parts business. Genesis II operates seven manufacturing facilities located in Pennsylvania, Ohio, Indiana and California.
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 $21.8 billion of assets under management (as of June 30, 2024). 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 $21.6 billion, operate 245 manufacturing facilities in 26 countries, and have approximately 64,000 employees, directly and through joint ventures worldwide (as of June 30, 2024, pro forma for the recent acquisitions of Sport Group and Innomotics which closed on July 8, 2024 and October 1, 2024, respectively). The KPS investment strategy and portfolio companies are described in detail at www.kpsfund.com.
