HGGC and Charlesbank Capital Partners have sold Citadel Plastics Holdings Inc. to A. Schulman for $800 million. Based in West Chicago, Illinois, Citadel is a provider of thermoplastic and engineered composite compounds.
PALO ALTO, Calif. — June 1, 2015 — Private equity firms HGGC and Charlesbank Capital Partners today announced that they have completed the sale of Citadel Plastics Holdings, Inc. (“Citadel” or “the Company”), a leading global provider of thermoplastic and engineered composite compounds, to A. Schulman (NASDAQ: SHLM) for $800 million.
Citadel is a West Chicago, Illinois-based provider of comprehensive materials solutions operating 21 production facilities around the world. The Company offers a broad portfolio of proprietary compounds to diverse blue-chip customers spanning multiple industries including transportation, industrial & construction, consumer, electrical, energy and healthcare & safety.
Since HGGC and Charlesbank invested in the Company in 2012, Citadel has grown both organically and through strategic acquisitions. The Company added Lucent Polymers in 2013 and The Composites Group in late 2014, creating an industry leader with more than 1,300 customers and over 2,000 active products.
“We’re very proud that Citadel grew revenue and EBITDA by roughly 70 percent during our three-year investment period,” said Gary Crittenden, Chairman of HGGC, who also served as Chairman of Citadel. “Citadel CEO Mike Huff and his outstanding management team really transformed Citadel into an impressive integrated, specialty plastics company, and we look forward to watching the company’s continued progress under its new owner.”
Operational enhancements that strengthened the business during HGGC and Charlesbank’s ownership include the launch of a unified, industry-focused go-to-market strategy, implementation of a common operating discipline across the portfolio, and improved financial management.
“We had a great partnership with Citadel’s management team, as the results clearly show,” said Brandon White, Managing Director of Charlesbank, who also served on the Board of Citadel. “The Company will be a tremendous addition to A. Schulman, and is well-positioned for ongoing success.”
The sale of Citadel, in which HGGC had a controlling interest, marks HGGC’s seventh exit of 11 middle market platform investments made out of its $1.1 billion debut fund. In March, HGGC announced the closing of its $1.33 billion second fund.
HGGC is a leading middle-market private equity firm with over $2.4 billion in cumulative capital commitments. Based in Palo Alto, Calif., HGGC is distinguished by its “Advantaged Investing” model that enables the firm to source and acquire scalable businesses at attractive multiples through partnerships with management teams, founders and sponsors who reinvest in deals alongside HGGC, creating a strong alignment of interests. Over its history, HGGC has completed platform investments, add-on acquisitions, recapitalizations and liquidity events with an aggregate transaction value of more than $10 billion, representing more than 45 transactions. More information is available at www.hggc.com.
About Charlesbank Capital Partners
Based in Boston and New York, Charlesbank is a middle-market private equity investment firm managing more than $3 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 A. Schulman, Inc.
A. Schulman, Inc. is a leading international supplier of high-performance plastic compounds and resins headquartered in Akron, Ohio. Since 1928, A. Schulman has been providing innovative solutions to meet its customers’ demanding requirements. A. Schulman’s customers span a wide range of markets such as packaging, mobility, building & construction, electronics & electrical, agriculture, personal care & hygiene, sports, leisure & home, custom services and others. A Schulman employs approximately 3,900 people and has 42 manufacturing facilities globally. A. Schulman reported net sales of approximately $2.5 billion for the fiscal year ended August 31, 2014. Additional information about A. Schulman can be found at www.aschulman.com.