The Sterling Group, a Houston-based private equity firm, has acquired Velcon Filters LLC, a Colorado Springs, Colo.-based filtration system manufacturer. No pricing terms were disclosed for the deal, which included leveraged financing from BNP PAribas and Amegy Bank of Texas.
The Sterling Group, L.P. (“Sterling”), a Houston-based private equity investment firm, today announced that it has completed the acquisition of Velcon Filters, LLC (“Velcon”). The acquisition was financed with equity primarily from Sterling Group Partners II, L.P. and debt financing from BNP Paribas and Amegy Bank of Texas.
Velcon, headquartered in Colorado Springs, CO, is a niche manufacturer of filtration systems, including vessels and replacement cartridges, that meet specific requirements for fluid filtration processes in a variety of domestic and international end-markets. Velcon is a global leader in the filtration process for jet fuel delivery, manufacturing products that filter, purify and remove water from jet fuel along the transport chain from the refinery to the aircraft. End users of Velcon’s products primarily include airports, contracted fuel providers, FBO operators, militaries, pipeline operators and to a lesser extent commercial and industrial diesel consumers, refineries and utilities.
Velcon was founded in 1953 by Lu Taylor. His son, David Taylor has run the business for the past 18 years. The Taylor family and members of management will continue to be substantial shareholders in Velcon in partnership with Sterling. “We are excited about the opportunity to partner with The Sterling Group given their proven track record. The Velcon team believes this partnership will provide significant opportunities to further develop and expand the company’s reach,” said David Taylor, who will remain CEO of Velcon.
“We look forward to working with Dave and the rest of the management team to continue to grow the business and create value for all shareholders,” said Greg Elliott, a Partner of The Sterling Group. “Velcon, with its strong reputation in the U.S. and abroad, is an ideal platform to expand into complementary product lines and other niche liquid filtration segments.”
About The Sterling Group, L.P.
Founded in 1982, The Sterling Group, L.P. (www.sterling-group.com) is a private equity investment firm that targets controlling interests in basic manufacturing, industrial services and distribution companies. Typical enterprise values of these companies range from $100 million to $500 million. Sterling has sponsored the buyout of 36 platform companies and numerous add-on acquisitions for a total transaction value greater than $8 billion. Currently, Sterling has $600 million of committed capital under management through two funds, including Sterling Group Partners II, L.P. Current portfolio companies include North American Energy Partners Inc., Panolam Industries International, Inc., CST Industries, Inc., Roofing Supply Group, LLC, BTEC Turbines LP and Universal Fiber Systems, LLC.