Electrical Components International Inc, a portfolio company of KPS Capital Partners, has closed a recapitalization. The recap was backed by a $50 million upsizing of an ECI term loan. Proceeds of the recap were used to fund a $50 million dividend to company shareholders. BofA Merrill Lynch served as lead arranger for the financing of the transaction. Based in St. Louis, Missouri, ECI is a maker of wire harnesses.
NEW YORK, Aug. 12, 2015 /PRNewswire/ — KPS Capital Partners, LP (“KPS”) announced today that its portfolio company Electrical Components International, Inc. (“ECI” or the “Company”) has completed a successful recapitalization. The proceeds of the recapitalization, funded by a $50 million upsizing of the Company’s term loan, were used to fund a $50 million cash distribution to stockholders.
ECI remains conservatively capitalized and has the continued support of KPS to pursue organic and strategic growth initiatives in North America and abroad. KPS is a private equity firm with approximately $5.6 billion of assets under management.
David Webster, Chief Executive Officer of ECI, said, “In ECI’s first year under KPS’ ownership, performance has exceeded our expectations. This recapitalization validates ECI’s significant strategic accomplishments under KPS ownership, and we are pleased to return capital to our stockholders. Over the past year, ECI has launched a new world-class, low-cost manufacturing facility in Morocco, won significant new business in both appliance and specialty-industrial end markets, and integrated the operations of Global Harness Systems into its global manufacturing footprint. ECI’s conservative capital structure and the financial support of our stockholders will allow us to continue to grow aggressively. We remain committed to deploying additional capital and resources in order to ensure total customer satisfaction, and thank our customers, suppliers and employees for their contributions to our success.”
Financing for the transaction was provided by a syndicate of banks and institutional investors with BofA Merrill Lynch acting as Lead Arranger.
Paul, Weiss, Rifkind, Wharton & Garrison LLP served as legal counsel to ECI with respect to the recapitalization.
About Electrical Components International, Inc.
ECI was founded in the 1950s and is headquartered in St. Louis, Missouri with 14 manufacturing facilities, 14 distribution centers and sales and engineering offices located in North America, South America, Asia, Europe and Africa. ECI is the leading global manufacturer and marketer of wire harnesses and provider of value-added assembly services for the home appliance industry and is a leading provider of wire harnesses to a diverse range of end markets. ECI has over 800 customers globally and its products can be found in a wide variety of electronic and electro-mechanical applications, including home appliances, agriculture and construction, heating, ventilation and air conditioning (HVAC), specialty transportation, automotive, commercial appliance and commercial electronics. ECI employs over 14,000 associates worldwide. For more information, please visit www.ecintl.com.
About KPS Capital Partners, LP
KPS is the manager of the KPS Special Situations Funds, a family of investment funds with approximately $5.6 billion of assets under management. KPS seeks to realize significant capital appreciation by making controlling equity investments in companies across a diverse range of manufacturing industries experiencing a period of transition or challenged by the need to effect immediate and significant change. The KPS investment strategy is based primarily upon partnering with world-class management teams to effect material and sustainable improvements in the operations of its businesses. Thereafter, KPS focuses on growing its businesses, both organically and through strategic acquisitions. KPS portfolio companies have aggregate annual revenues of approximately $5.9 billion, operate 98 manufacturing facilities in 23 countries and employ approximately 43,000 associates, directly and through joint ventures worldwide. The KPS investment strategy and portfolio companies are described in detail at www.kpsfund.com.