New York-based private equity firm Arsenal Capital Partners has acquired Royal Adhesives & Sealants, a South Bend, Indiana-based provider of sealant products for the aerospace and defense, construction, specialty packaging, automotive, and industrial markets. Financial terms of the deal were not released, however, New York-based Prospect Capital provided $14 million in debt financing to support the deal.
Arsenal Capital Partners, a leading New York-based private equity firm that invests in middle-market specialty industrial, healthcare, and financial services companies, today announced the acquisition of Royal Adhesives & Sealants, LLC (“Royal”) from Quad-C Management, Inc.
Royal Adhesives & Sealants, LLC is a leading producer of proprietary, high-performance adhesives and sealants. Headquartered in South Bend, Indiana, Royal offers a broad range of specialty formulated products designed to solve complex bonding, laminating and sealing applications across a diverse range of markets including aerospace and defense, construction, specialty packaging, automotive and industrial. The company offers a broad spectrum of customized thermosetting epoxy and urethane, solvent-based, and water-based technologies to meet the most demanding adhesive and sealant applications.
John Televantos, a Partner at Arsenal Capital said, “Royal has industry-leading capabilities that provide proprietary, value-added solutions for its customers. We are impressed by the accomplishments of the Royal team and we look forward to working with management to continue the company’s focus on customer service and to drive growth through innovation. This is an exciting sector and we plan new investments in the business and further acquisitions to accelerate global growth and expand the platform into new technologies and geographies.”
Ted Clark, Chief Executive Officer of Royal, said, “We are delighted to partner with Arsenal Capital. Arsenal has a successful track record of building similar companies in the middle-market specialty industrials sector and their experience will better enable us to take our company to the next level of growth and innovation.”
Timothy Zappala, a Partner at Arsenal Capital, added, “Royal has a long history of innovation and a demonstrated ability to achieve steady organic growth. Additionally, the management team has successfully targeted specialty acquisitions that complement its business lines and broaden the industries it serves. Management has successfully integrated these new businesses and built a cohesive company that provides a wide range of technologies and we hope to build upon their market leading position.”
Arsenal’s current investments in the specialty industrials sector include Velsicol Chemical, a manufacturer of high performance chemicals used in agriculture and industrial applications, and Novolyte Technologies, a manufacturer of specialty electrolyte materials for lithium ion battery and energy storage applications and a variety of other technically demanding custom manufactured products for the electronics, pharmaceutical and industrial markets. Earlier this year, Arsenal sold Genovique Specialties Corporation to Eastman Chemical Corporation and IDQ to Castle Harlan, in transactions which returned in excess of 12.0x and 8.0x invested capital to investors, respectively.
About Arsenal Capital Partners
Arsenal Capital Partners is a leading New York-based private equity firm that invests in middle-market specialty industrial, healthcare and financial services companies. Arsenal makes investments in sectors where the firm has prior knowledge and experience, and targets businesses that have the potential for further value creation by working closely with management to accelerate growth and leverage the firm’s operational improvement capabilities. Arsenal currently has $800 million of committed equity capital. For additional information on Arsenal Capital Partners, please visit www.arsenalcapital.com.