Simultaneously acquiring and uniting a pair of complementary assets is a popular PE strategy aimed at starting out with more meaningful scale.
One Equity Partners is one firm that likes this approach. Marking its latest new platform investment, the firm bought and merged two businesses to create what it believes will be a front-runner in wood processing equipment, aftermarket parts and consumables – a segment ripe for growth with lumber demand high and ESG top of mind.
The New York private equity firm completed the joint acquisitions of USNR and Wood Fiber Group to create a combined company with projected 2021 revenues greater than $500 million.
“This is a perfect example of [an] OEP type of deal – we try and find good industries that may be niche and can benefit from consolidation,” James JB Cherry, senior managing director at OEP, told PE Hub’s Aaron Weitzman.
One important tailwind? “Demand for lumber is only going to continue to be strong over the next few years,” Cherry said. “With high-home prices, lumber will be needed for not only new homes, but remodels of existing homes. And there is also more demand for lumber in non-residential buildings.”
ESG is also at play considering “wood products [are] increasingly favored as a building product,” he added.
Elsewhere, Gryphon Investors is investing for a third time in the skincare products and services and what it describes as its first in the physician dispensed skincare category.
Gryphon is buying Revision Goodier — which includes Revision Skincare and Goodier Cosmetics — and “represents a bullseye opportunity for Gryphon and leverages our proactive focus of investing behind leading efficacious skincare brands,” according to Matt Farron, partner and head of Gryphon’s Consumer Group.
Revision Skincare provides dermatologists, plastic surgeons and medical spas with clinically proven, high-performing skincare products, while Goodier Cosmetics develops and manufactures cosmetic and OTC topical skincare solutions.
Gryphon’s investment aims to support the independent skincare brand’s mission of bringing clinically proven and high-performing products to a global customer base, as well as to enhance CDMO growth.
That’s it for me! Have a great week ahead, hubsters! As always, write to me at firstname.lastname@example.org with any tips, gossip or feedback.