Gryphon buys Shermco from Oaktree


Gryphon Investors has acquired Irving, Texas-based Shermco Industries, a provider of electrical testing, maintenance and repair services, from Oaktree Capital. No financial terms were disclosed. KeyBanc Capital Markets served lead financial adviser to Gryphon while Harris Williams & Company was financial adviser to Shermco. And, Ropes & Gray provided legal advice to Gryphon and Kirkland & Ellis served as legal adviser to Shermco.

PRESS RELEASE

SAN FRANCISCO, June 5, 2018 /PRNewswire/ — Gryphon Investors (“Gryphon”), a San Francisco-based private equity firm, today announced that it has acquired Shermco Industries (“Shermco” or “the Company”), the leading independent provider of electrical testing, maintenance, and repair services in North America, from funds managed by Oaktree Capital Management, L.P.’s Power Opportunities Group. CEO Ron Widup and other members of Shermco’s management team have retained a significant ownership position in the Company and will continue to lead Shermco. Former Entergy senior executive and Gryphon advisor Bill Mohl will become Chairman of Shermco. Financial terms were not disclosed.

Founded in 1974 and headquartered in Irving, Texas, Shermco provides electrical testing, maintenance, commissioning, and repair services to a wide range of utility, industrial, energy, and other end markets across North America. With more than 400 NETA (InterNational Electrical Testing Association) technicians and more than 90 utility protection & control (“P&C”) technicians, Shermco serves a diversified blue-chip customer base throughout the U.S.

Alex Earls, Partner and head of the Business Services Group at Gryphon, said, “Shermco fits squarely within Gryphon’s strategy of acquiring growing, differentiated market leaders in industries with attractive long-term fundamentals. Ron and his management team have built a first class business and we are excited to partner with them to support the Company’s continued growth both organically and through acquisitions.”

Phil Petrocelli, a Partner in Gryphon’s Operations Resources Group, added, “We have been extremely impressed by Shermco’s strong track record of hiring and developing its technicians and engineers while building a strong safety culture to protect them. We are highly enthusiastic about partnering with Ron and his team to accelerate the Company’s growth through a number of strategic initiatives.”

Gryphon’s current and past investments in the engineering services and industrial services sectors include JENSEN HUGHES, the global leader of fire protection engineering services; HEPACO, a leading provider of specialized environmental services on both an emergency and planned basis; and Trinity Consultants, the leading provider of air quality compliance services.

Tim Bradley, a Principal in Gryphon’s Business Services Group, added, “Shermco has built a leading market position over time and we are excited about the many opportunities to further accelerate growth and expand its services to better serve its customers.”

Mr. Widup stated, “We are excited to partner with Gryphon as we continue to execute our shared growth initiatives through geographic expansion, servicing national accounts, and continuing our acquisition strategies. We believe that Gryphon brings significant resources and relevant sector expertise to support these efforts.”

KeyBanc Capital Markets served as the lead financial advisor to Gryphon and Harris Williams & Company acted as the exclusive financial advisor to Shermco. Ropes & Gray acted as the legal advisor to Gryphon and Kirkland & Ellis acted as the legal advisor to Shermco.

About Shermco
Headquartered in Irving, Texas, Shermco provides electrical testing, maintenance, commissioning, and repair services to a wide range of utility, industrial, energy, and other end markets. With more than 20 locations, Shermco serves a diversified blue-chip customer base across North America. The Company is an active participant in the InterNational Electrical Testing Association, Electrical Apparatus Service Association, and American Wind Energy Association. For more information, please visit www.shermco.com.

About Gryphon Investors
Based in San Francisco, Gryphon Investors (www.gryphoninvestors.com) is a leading private equity firm focused on profitably growing and competitively enhancing middle-market companies in partnership with experienced management. For 23 consecutive quarters, Gryphon has been ranked in Preqin’s prestigious quarterly PE report as one of North America’s top-decile buyout firms based on consistency of strong investment returns. Managing over $4 billion of equity investments and capital since 1997, the firm has an extensive track record of leading equity investments of $50 million to $200 million per portfolio company with sales ranging from approximately $100 million to $500 million. Gryphon prioritizes investment opportunities where it can form proactive partnerships with owners and executives to build leading companies, utilizing Gryphon’s capital, specialized professional resources, and operational expertise. Gryphon closed its fourth private equity buyout fund, Gryphon IV, L.P., in November 2016 at $1.1 billion, and raised a $100 million captive mezzanine fund, Gryphon Mezzanine Partners, L.P., in August 2017.

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