Frontenac Company LLC has sold Atlanta-based H-E Parts International LLC, a provider of aftermarket parts, components and solutions for the mining, heavy construction and energy sectors. The buyer is Hitachi Construction Machinery Co. Ltd. No financial terms were disclosed.
Chicago – December 21, 2016
Frontenac Company LLC, a Chicago‐based private equity firm, today announced that it has completed the sale of H‐E Parts International LLC, the leading independent global provider of aftermarket parts, components and solutions for the mining, heavy construction and energy sectors to Hitachi Construction Machinery Co., Ltd., a Japanese public stock company. This marks the fourth successful enterprise sale by Frontenac in the last five quarters. Terms of the transaction were not disclosed.
Founded in 2006 and headquartered in Atlanta, Georgia, H‐E Parts has consolidated the fragmented industry that providesindependent aftermarket partssolutionsfor heavy equipment and created the global leader in its market. H‐E Parts has successfully acquired, integrated and professionalized thirteen companies, each of which were family or founder owned businesses addressing a specific product or geographic market. Today, the Company is a global player, with operations in Australia, China, Chile, Peru, Canada and the United States.
“From our very first introduction and continuing through the acquisition and ownership process, the Frontenac team has shown nothing but professionalism and integrity,” said Steve McBrayer, CEO of H‐E Parts. “We created the worldwide leader in our industry though organic growth and a series of strategic acquisitions. It was also important that we make the right investments in people and processes to create a truly integrated company. Frontenac worked closely with us across all these key success factors. We are excited about the strong trajectory of the Company and the opportunity to continue to grow with the support of Hitachi.”
“We are proud of our successful partnership with H‐E Parts and its entire management team,” said Paul Carbery, Managing Partner of Frontenac. “Our investment thesis for H‐E Parts was ambitious: to create the leading independent global provider of solution services and parts to the aftermarket for heavy equipment. Our original CEO1ST partner, JP Richard, collaborated with us to conceive this strategy. Together with our current CEO, Steve McBrayer, the management team and our Australian equity partner, CHAMP Ventures, we have executed on that vision and created a company that delivers exceptional value to its customers. Frontenac is pleased to have worked with the team to achieve this level of scale and success. We are confident that H‐E Parts will continue its strong growth under new ownership.”
“This successful investment in H‐E Parts is a great example of the Frontenac playbook in action,” added Michael Langdon, Managing Director of Frontenac. “We leveraged our expertise with family and founder‐owned businesses and our executive network across the industrial services vertical to identify a unique investment opportunity; we partnered with a great management team; we augmented the board with experienced industry executives from our network; and we provided the capital to make strategic investments and complete accretive acquisitions. We are pleased with the success of the Company and are excited about its future.”
Robert W. Baird & Co. and Gresham Advisory Partners Ltd. acted as financial advisors to the Company. Kirkland & Ellis served as lead legal counsel to the Company.
About H‐E Parts
H‐E Parts International has grown to become the largest independent global provider of aftermarket parts, components and solutions for the mining, heavy construction and energy sectors. H‐E Parts is the result of the strategic acquisition of a number of the world’s leading aftermarket parts and service companies, able to leverage each other’s technologies and customers on a global basis. The company has a strong global presence, with North American and Chilean operations serving the Americas, and Australian operations serving Asian and Australian markets. For more information, visit www.h‐eparts.com.
About Frontenac Company
Frontenac is a leading private equity firm, based in Chicago. The firm focuses on investing in lower middle market buyout transactions in the food, industrial, and services industries. Frontenac works in partnership with proven operating leaders, through our executive‐centric approach called CEO1ST, to identify, acquire, and build market leading companies through transformational acquisitions and operational excellence. The firm has built a leading franchise working with over 225 owners of mid‐sized businesses, almost always families or founders, as they address complex transition issues of liquidity, management enhancement, and growth planning. For more information, please visit www.frontenac.com.