PE-owned Citadel Plastics completes Lucent acquisition

Citadel Plastics, which is owned by HGGC and Charlesbank Capital Partners, said Monday that it has closed its buy of Lucent Polymers. The seller was River Associates Investments. No financial terms were disclosed. Headquartered in Evansville, Indiana, Lucent is a provider of highly engineered compounds that leverage sustainable inputs.

PRESS RELEASE

WEST CHICAGO, Ill.—December 9, 2013—Citadel Plastics Holdings, Inc. (“Citadel” or “the Company”), a leading global compounder of thermoplastic and thermoset resins, today announced that it has completed the acquisition of Lucent Polymers (“Lucent”), a leading supplier of highly engineered compounds that heavily leverage sustainable inputs, from Chattanooga, Tennessee-based River Associates Investments, LLC. Terms of the private transaction were not disclosed.
“Lucent is a very strategic acquisition for Citadel, bringing outstanding expertise in material science and sustainable products technology, as evidenced by its broad portfolio of more than 1,400 formulations,” said Mike Huff, CEO of Citadel Plastics. “The addition will significantly increase our presence in engineered resins and improve our market position for future growth with new customers and new end markets.”
Lucent is headquartered in Evansville, Indiana, where Citadel’s Thermoplastics Division is also headquartered. The company has differentiated itself in the U.S. compounding industry through its proven ability to formulate, source and utilize various low-cost feed streams to meet exacting specifications. Over the past seven years, Lucent exceeded the industry’s growth rate by more than 95 percent. In addition to continuing the manufacture of its existing products, Lucent will begin to produce Citadel’s Matrixx, Aclo, QTR and Fiberfil brands.
“The addition of Lucent Polymers expands Citadel’s ability to fulfill a variety of customer needs across multiple sectors,” said Kevin Andrews, President of Citadel Thermoplastics Division. “Like Citadel, Lucent is critical to its customers’ development initiatives. The combination of experience and greater scale achieved through this transaction enhances both organizations’ ability to partner with customers to provide innovative technical solutions.”
The purchase of Lucent Polymers is the seventh plastics-related acquisition for Citadel since 2007 and is the 31st acquisition for HGGC, a private equity firm with a controlling interest in Citadel.
“We are very pleased to build on Citadel’s proven ability to grow through strategic acquisition and integration of successful, complementary businesses,” said Gary Crittenden, Chairman of Citadel who also serves as Chairman of HGGC. “We’re confident Lucent’s blue-chip customer base and financial strength will help Citadel extend its leadership in highly engineered compounds.”
About Citadel Plastics Holdings
HGGC of Palo Alto, California, and Boston-based Charlesbank Capital Partners are the primary owners of Citadel Plastics. Citadel is a leading provider of custom material solutions including both thermoplastics and composite products. Citadel’s end markets include automotive, electrical, construction, HVAC, home and garden, and appliance. Formed in 2007 and built through a series of cornerstone and tuck-in acquisitions, Citadel’s custom-engineered solutions, stable margin profile and blue chip customer base provide attractive opportunities for future growth. Citadel is headquartered in West Chicago, Illinois, and has a global workforce spread across seven countries.
About HGGC
Based in Palo Alto, California, HGGC is a leading private equity firm focusing on leveraged buyout, recapitalizations and growth equity transactions in the middle market. The firm seeks to partner with strong management teams and founders to build companies capable of generating sustainable growth. With years of collective deal and operational experience, HGGC brings best practices from private equity and global corporations to help middle market businesses in a wide range of industries outperform the market. The firm is currently investing out of a $1.1B Fund. For more information, please visit www.hggc.com.
About Charlesbank Capital Partners
Based in Boston and New York, Charlesbank Capital Partners is a middle-market private equity investment firm managing more than $2 billion of capital. Charlesbank focuses on management-led buyouts and growth capital financings, typically investing $50 million to $150 million per transaction in companies with enterprise values of $100 million to $750 million. The firm seeks to partner with strong management teams to build companies with sustainable competitive advantages and excellent prospects for growth. For more information, visit www.charlesbank.com.
About River Associates Investments, LLC
River Associates is a Chattanooga, TN-based private equity partner for management teams in change-in-control transactions of lower middle market companies. Target businesses can be privately held or divestitures from larger companies or other private equity groups. River Associates is opportunistic as to industry and has invested in manufacturers, high-margin distributors, industrial service, business service and select non-faddish retail companies. The firm is currently investing River VI, L.P. with $222 million of committed capital, and focuses on companies with EBITDA of $4-12 million in companies headquartered in the United States & Canada. Since its founding in 1989, River Associates has initiated over seventy transactions, many of which have been strategic add-on acquisitions to platform companies. The principals of River Associates have over eighty years of collective experience working together, and their alignment of interests with LP investors is illustrated by their substantial GP investment in River funds. For more information on the firm please visit www.riverassociatesllc.com.

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