Berkshire Partners has sold Advanced Drainage Systems, of Ohio. ADS produces corrugated HDPE pipe. Berkshire Partners is a Boston PE shop. Financial terms were not announced. It was not disclosed who was the buyer.
Berkshire Partners LLC, the Boston-based private equity firm, today announced it has sold its ownership position in Advanced Drainage Systems, Inc. (ADS), the leading manufacturer and distributor of corrugated high-density polyethylene (HDPE) pipe products in the world. Terms of the transaction were not disclosed.
Founded in 1966 and headquartered in Hilliard, Ohio, ADS operates a global network of 48 domestic and international manufacturing plants and more than 22 distribution centers. ADS serves a variety of markets including storm and sanitary sewer systems, stormwater retention/detention systems, septic systems, roadway constructions, residential and commercial construction, golf courses, athletic fields and agriculture. Today, more than 8.5 billion feet of ADS pipe are in service around the world.
Berkshire first invested alongside ADS management in 1988 as part of a recapitalization of the Company. Since then, ADS has grown its core HDPE pipe business at a double-digit annual growth rate, and successfully entered multiple adjacent product categories and numerous international markets. In 2005, Berkshire worked with ADS management in the Company’s acquisition of Hancor, Inc. Since Berkshire’s initial investment, ADS’ workforce has grown from approximately 700 to over 3,000 employees worldwide today. Berkshire’s initial equity and sub debt investment in 1988 yielded a blended return of 9x through 2002. Subsequent Berkshire investments made since then have generated an additional 5x return on capital.
Michael C. Ascione, Managing Director of Berkshire Partners, said, “Over the past twenty-two years, Berkshire has enjoyed a wonderful relationship with a first class management team and company. We have engaged with management to provide perspective and support on a variety of strategic issues. Over the years, ADS has become the global leader in HDPE pipe products, and has generated extraordinary returns for all its shareholders.”
“The partnership between ADS and Berkshire not only helped the Company achieve significant growth and scale, but it also exemplifies Berkshire’s history of being a long-term, patient private equity investor,” said Joseph A. Chlapaty, Chief Executive Officer of ADS.
Barclays Capital acted as financial advisor to ADS.
About Berkshire Partners LLC
Berkshire Partners, the Boston-based private equity firm, has invested in leading mid-sized companies for over twenty-five years through seven investment funds with aggregate capital of $6.5 billion. Berkshire has developed specific industry experience in several areas including retailing, consumer products, manufacturing, transportation, energy, business services and communications. Representative investments include Amscan/Party City, Bare Escentuals, Carter’s, Crown Castle International, NEW Asurion and TransDigm. Since the mid-1980s, Berkshire has invested in over 100 companies with approximately $20 billion of acquisition value and combined revenues of over $22 billion. Berkshire seeks to invest $50 million to $500 million of equity capital in each portfolio company. For additional information, visit www.berkshirepartners.com.
About Advanced Drainage Systems, Inc.
Advanced Drainage Systems, Inc. (ADS) is the world’s largest producer of corrugated HDPE pipe. Founded in 1966, it serves the storm and waste water industry through a global network of 48 domestic and international manufacturing plants and more than 22 distribution centers. In addition to its flagship N-12 pipe, the company offers a complete line of fittings and other accessories including StormTech storm water chambers, Nyloplast® drainage structures, BaySaver Technologies® storm water treatment units, FLEXSTORM™ Inlet Filters and various geotextiles. For more information, visit www.ads-pipe.com.