Off the beaten path, St. Louis-based Compass Group seeks six add-ons in 2019

Compass Group Equity Partners, the St. Louis private equity firm, is seeking at least six add-ons in 2019, Vice President Russell Williams told Buyouts.

Last week, the firm acquired Protech Global Solutions, an electronics manufacturing services and third-party logistics solutions provider.

The acquisition marks the fourth add-on to its flagship Compass Electronics Group platform since summer 2017. Protech operates facilities in El Paso, Texas, and Ciudad Juárez, Mexico.

The electronics-group platform, providing electronics design, manufacturing and engineering, is expected to post more than $100 million of revenue this year, according to a source familiar with the company.

Compass is looking for opportunities in fragmented market areas dominated by smaller players, including in electronics-manufacturing services.

Besides electronics manufacturing services, the firm has investments in industrial and automation, and functional food and beverage markets.

Overall Compass this year is targeting acquisitions that add capabilities, geographies and end-market customers, Williams said.

The PE shop invests deal by deal on behalf of more than 20 family offices mainly located in middle America.

With a base in St. Louis, Compass has easier access to bicoastal opportunities and also faces less competition from PE rivals in the Midwest, Williams said.

“It’s a great place to be a private equity firm because you don’t walk out of your office and run into three other private equity firms. There are a lot of opportunities here that are often overlooked,” he said.

Partners at Compass are actively attending conferences and forums to develop relationships with family offices.

Founded in 2014, the firm tends to pitch investing opportunities selectively to each family office and only after developing a rapport with an investor, Williams said.

Sharing the same culture with investors is key to developing and keeping those relationships alive, Williams added.

“It’s hard for East Coast guys to gain a [foothold] in Midwest states. We sort of speak the same language, we have a similar cultural backgrounds, which plays into our advantage,” he said.

In September 2018, the platform added Qualitronics, the Richmond, Indiana, wiring harness and cable assembly provider.

Update: This report has been updated to provide more clarity around Compass Group’s future plans. 

Action Item: Contact Compass Group at +1 203-221-1703.