TVV Capital has sold Illinois-based Big 3 Precision Products Inc, a maker of packaging solutions, to The Eastern Company. The purchase price was $81.7 million. Stout advised TVV in the transaction while Pinnacle Financial Partners provided TVV’s initial debt financing for Big 3. And, Bass Berry & Sims served as counsel for Big 3.
NASHVILLE, Tenn.—TVV Capital, a Nashville-based middle-market private equity firm, announced today it has successfully closed the sale for $81.7 million of Big 3 Precision Products, Inc. (“Big 3” or the “Company”), a market-leading manufacturer of turnkey packaging solutions.
Big 3 was sold to The Eastern Company, a publicly-traded diversified manufacturer. The sale generated a 12X return on invested capital for TVV Capital Partners III.
Through its two segments, Big 3 Precision Products and Big 3 Precision Mold Services, Big 3 serves diverse markets including truck, automotive, plastic packaging products, packaged consumer goods, and pharmaceuticals. Big 3 Precision Products works with leading manufacturers to design and produce custom returnable packaging to integrate with their assembly processes. Big 3 Precision Mold Services is a global leader in the design and manufacture of blow mold tooling. Based on unaudited, internal financial statements of Big 3, for the twelve months ended June 30, 2019, the Company generated sales of $72.2 million and the Company’s sales have grown by double digits in each of the last five years.
Since purchasing Big 3 in 2012, TVV has successfully demonstrated the power of its buy-and-build strategy and operational focus through the growth of the Company. During the hold period, it built out a new 87,000-square-foot facility in Detroit and completed three add-on acquisitions, including the recent purchase of a UK-based manufacturer of blow mold tooling, marking a major step into global expansion for the Company.
TVV increased Big 3’s EBITDA by 245% to $13.4 million during its ownership period, and grew total sales from $28 million in 2012 to $72.2 million in the last 12 months. Management owned over 16% of the equity of Big 3.
Alan Scheidt, Big 3’s former CEO and senior advisor said, “We are pleased to have worked closely with TVV to position Big 3 over the past seven years for this milestone. TVV was a trusted partner for management, able to guide us on the growth path that has led to this acquisition. The firm’s strong focus on operational improvement allowed us to increase our market share, grow revenue and EBITDA and expand internationally. We set out seven years ago with certain objectives in mind, and we nailed every one of them. TVV took care of everyone involved.”
Andrew W. Byrd, TVV’s President said, “When TVV acquired Big 3 in 2012, we immediately understood that its strong asset base, its ability to generate cash flow and its diversified revenue stream were real strengths that would allow the company to continue on its growth trajectory. The company’s outstanding management team worked hand in hand with us to pursue successfully our growth strategy. We wish the company all our best for its next chapter under the new ownership.”
Stout advised TVV in the transaction. Pinnacle Financial Partners provided TVV’s initial debt financing for Big 3. Bass Berry & Sims served as counsel for the Company.
About Big 3
Big 3 Precision Products offers design and fabrication services to create container and racking systems for the aerospace, truck, automotive, plastic, glass, fiberglass, military, and SMC industries. Solutions include packaging trays, bar dunnage, flipper dunnage, shipping trays, specialty pallets, dunnage trays, and extend to complex steel racks and racking systems for products as diverse as airplane components and automated automotive seat pallet systems. Big 3 Precision Mold Services offers a full solution capability for product development, preform design, and commissioning of production-ready tools for IBM, ISBM, 2-step blow mold, and EBM methods. For more information about Big 3, please visit www.big3precision.com.
About TVV Capital
Nashville-based TVV Capital is an operationally-focused private equity investment firm that targets high- performing niche manufacturing companies in the lower middle-market. The firm seeks to accelerate portfolio growth and expansion through an operational value-added approach, utilizing senior manufacturing executives to forge close working partnerships with portfolio company leadership. TVV employs a direct-to-owner acquisition sourcing model that targets companies with enterprise values from $10 to $100 million and EBITDA margins of 10 to 25 percent, and which are characterized by consistent profitability, strong management, and identifiable growth prospects. The firm is managed by an experienced team that has established a 20+ year track record of delivering best-in-class investment returns. For further information, please visit www.tvvcapital.com.