Swander Pace Sells International Fiber to Arsenal Capital

Arsenal Capital Partners has acquired International Fiber Corp. from Swander Pace Capital. Financial terms weren’t announced. North Tonawanda, N.Y.-based International Fiber supplies cellulose‐based insoluble fiber products for food and industrial applications. Sagent Advisors advised Arsenal.


NEW YORK, August 28, 2013 – Arsenal Capital Partners, a leading New York-based private equity firm that invests in middle-market specialty industrial and healthcare companies, announced today the acquisition of International Fiber Corporation (“IFC”), the leading supplier of cellulose‐based insoluble fiber products for food and industrial applications globally.  Prior to close of this acquisition, IFC was a portfolio company of Swander Pace Capital.
Founded in 1917, and headquartered in North Tonawanda, NY, IFC is the industry leader in insoluble fiber products, providing exceptional service and customized product solutions. IFC’s fiber is used in food applications for a variety of functions including improving taste and texture, enhancing yield and processability, and numerous health benefits.  In industrial applications, IFC’s fiber is used to thicken paints, strengthen rubber used in industrial hoses and belts, for filtration as well as to control viscosity in thermoplastics.  IFC’s products include brands such as Solka-Floc, Alpha-Cel, KEYCEL, JustFiber, FloAm, Qual Flo, and NutraFiber.  IFC has operating facilities in North Tonawanda, NY, Urbana and Oberlin, OH, Nitro, WV and Temse, Belgium.
“Arsenal is delighted to invest in a global company with long history of innovation providing great solutions and service to its diverse customers. IFC maintains a strong industry reputation by providing its customers with the highest level of performance and quality, and is well‐positioned to capitalize on the growing demand for fiber products both domestically and internationally,” said John Televantos, a Partner who co-heads the Arsenal’s Specialty Industrials practice.
“We look forward to partnering with IFC management, growing the business organically as well as building through strategic acquisitions to further expand its offerings,” added Sal Gagliardo, an Operating Partner at Arsenal.
“Swander Pace is pleased with the growth and performance of IFC throughout the duration of our investment, which included the addition of a new production facility, expansion into several new product categories and a significant increase in production capabilities,” said Swander Pace Managing Director Mo Stout. “It has been a very rewarding partnership on both sides, and our team will continue to look for opportunities to partner with innovative, industry-leading companies, such as IFC.”
Arsenal Senior Advisor Ken Blackburn will assume the position of Chief Executive Officer of IFC following successful executive roles with Arkema Corp., FMC Corp. and ITT Rayonier.  “I’m excited to join a best-in-class team at IFC, and look forward to the growth IFC is well-positioned for in both the U.S. and international markets.  As we further expand the business’s product suite, we hope we can continue to improve the service and solutions we provide to our customers.”
The acquisition of IFC is the eighth acquisition by Arsenal in 2013, and sixth by its Specialty Industrials Team following the acquisitions of TP Electrical, Fournier Air Conditioning and Refrigeration, Arnco, Pathway Polymers and ADCO Global, Inc. IFC joins Arsenal’s extensive portfolio of investments in the specialty industrials sector.
Arsenal’s current investments in the specialty industrials sector include Dash Multi-Corp., a leading manufacturer of formulated polyurethane, vinyl plastisol, specialty coatings as well as recycled rubber products; IGM Resins, a leading provider of intermediates to the global ultraviolet (“UV”) radiation cure coatings, inks and adhesives industry; Chromaflo Technologies, the largest independent global pigment dispersion provider to the architectural and industrial coatings and thermoset composites industries; Fluoro-Seal Holdings, a leading provider of unique plastic barrier, adhesion and surface enhancement products and services as well as manufacturer of value-added materials; Royal Adhesives & Sealants, the largest global pure-play producer of proprietary, high-performance adhesives, sealants and coatings. Previous investments in the sector include Novolyte Technologies, Genovique Specialties, Velsicol Chemical, Sermatech International, and Vertellus Specialties.
Sagent Advisors acted as financial advisor and DLA Piper LLP acted as legal advisor to Arsenal.  Kirkland & Ellis LLP acted as legal advisor to Swander Pace.
About Arsenal Capital Partners
Arsenal Capital Partners is a leading New York-based private equity firm that invests in middle-market specialty industrial and healthcare companies. Arsenal makes investments in sectors where the firm has significant prior knowledge and experience.  Arsenal targets businesses that have the potential for further value creation by working closely with management to accelerate growth and leverage the firm’s operational improvement capabilities. Arsenal currently has $1.7 billion of committed equity capital. For additional information on Arsenal Capital Partners, please visit www.arsenalcapital.com.
About Swander Pace Capital
Swander Pace Capital is a leading private equity firm specializing in investments in growth-oriented, lower middle-market consumer companies. Since its inception in 1996, Swander Pace has used its expertise in this industry to pursue a consistent strategy of acquiring or investing in consumer products companies with leading market positions in attractive, defensible niches. With offices in San Francisco and New Jersey, Swander Pace provides portfolio companies with a unique mix of financial and strategic consulting support to create long-term investment value. Swander Pace has led successful private equity investments in consumer companies with total revenues in excess of $2.0 billion. For more information, visit www.spcap.com.