Platinum Equity to make 5x its money on Nesco

Nesco was a very good deal for Platinum Equity.

The PE firm founded by Tom Gores said Thursday it closed its sale of Nesco to Energy Capital Partners. Financial terms weren’t announced, but the deal is valued at $875 million, Moody’s Investors Service said in a Jan. 21 note.

Platinum made about 5x its money with its investment in Nesco, a source said. The Los Angeles PE firm acquired Nesco in 2011. The investment came from its second fund which collected $2.75 billion in 2007. Platinum last year closed its third pool, which raised $3.75 billion.

Fort Wayne, Ind.-based Nesco provides equipment such as cranes and bucket trucks for electrical contractors and utilities to construct and maintain transmission and distribution lines in the U.S. and Canada.

Platinum Equity owned a “substantial majority” of Nesco, according to CEO Lee Jacobson.

“We’ve had a great partnership with Platinum Equity and we anticipate equal or greater partnership with Energy Capital,” Jacobson told peHUB.

Jacobson said he is staying with Nesco after the sale but is unclear about the rest of management.

“Since we closed yesterday, only time will tell. I fully expect everyone to stay,” he said.

Nesco produced $200 million in trailing 12 months revenues for the period ended Sept. 30, Moody’s said. In March 2012, Nesco issued $275 million in notes that it used to repay debt, refinance interim financing and issue a dividend, Moody’s said at the time.

Officials for Platinum declined comment.

Photo of a 7-9 ton Knuckle Crane courtesy of Nesco