Our deep respect for each company’s people and legacy drives how we operate.
We search for good companies and then help them become great enterprises.
We search for good companies and then help them become great enterprises.
We search for
good companies—
and then help them
become great
enterprises.
We search for good companies and then help them become great enterprises.
National Power is a value-added distributor of critical backup power and infrastructure solutions for the cable broadband and wireless telecom industries. National Power customizes, implements, and services solutions to keep enterprises of all sizes running.
The deal—told by Mark
Sometimes, the right kind of transition is more of a gradual handoff. National Power was founded in North Carolina in 1989, literally in the owner’s garage, as a reseller of backup-power batteries. Over the years, the business grew into a major provider of configuring, selling and servicing commercial and industrial backup power systems across the southeast. Along the way, it developed a specialization in serving the infrastructure needs of the cable and wireless industries. It had grown from primarily an equipment company into a solutions and service business, though still quite regional in scope and scale. The founder was approaching retirement and wanted to transition the company but also ensure that new ownership would honor its legacy, preserve its heritage and support future growth.
We learned of the opportunity from a former colleague of John’s, an investment banker who knew that we were interested in family-owned, founder-led industrial businesses. After an introductory call, we were invited to meet with the seller. We think it’s our responsibility as investors, and a sign of respect to a seller, to understand both the industry and the specific business the best we can early on, so we did extensive homework before the initial in-person management presentation. The level of insight we developed and the questions we asked helped establish a strong rapport.
The seller described the attachment he felt to his life’s work and his deep desire to remain involved but at a decreasing pace over time. We proposed a three-phase transition in which he would partner with us on the recruitment and selection of his successor to lead the company, transition to a part-time role working in his desired area and then retire from the company and attend board meetings each quarter. We believe this is one of many compelling elements of our offer that led to the selection of our LOI.
To make it easier for potential financing partners to study the proposed acquisition, we wrote a detailed investment opportunity memorandum describing our investment thesis and value creation plan as well as any risks we saw and how we planned to manage them. After approaching a number of interested parties, we received five fully funded proposals to support the entire acquisition.
Shortly after the closing in 2019, we held a strategic-planning offsite with the founder and management team where we all collaborated to identify the greatest opportunities to grow the company and increase its value over the coming five years, and then we developed a three-year growth strategy and supporting investment plan. Working together with the founder, the new CEO and everyone at the company, we’ve helped the business expand to a true national footprint and double its number of employees, revenue, and EBITDA. The company was always called National Power, and now it truly is a nationwide and rapidly growing enterprise.
National Power is a value-added distributor of critical backup power and infrastructure solutions for the cable broadband and wireless telecom industries. National Power customizes, implements, and services solutions to keep enterprises of all sizes running.
The deal—told by Mark
Sometimes, the right kind of transition is more of a gradual handoff. National Power was founded in North Carolina in 1989, literally in the owner’s garage, as a reseller of backup-power batteries. Over the years, the business grew into a major provider of configuring, selling and servicing commercial and industrial backup power systems across the southeast. Along the way, it developed a specialization in serving the infrastructure needs of the cable and wireless industries. It had grown from primarily an equipment company into a solutions and service business, though still quite regional in scope and scale. The founder was approaching retirement and wanted to transition the company but also ensure that new ownership would honor its legacy, preserve its heritage and support future growth.
We learned of the opportunity from a former colleague of John’s, an investment banker who knew that we were interested in family-owned, founder-led industrial businesses. After an introductory call, we were invited to meet with the seller. We think it’s our responsibility as investors, and a sign of respect to a seller, to understand both the industry and the specific business the best we can early on, so we did extensive homework before the initial in-person management presentation. The level of insight we developed and the questions we asked helped establish a strong rapport.
The seller described the attachment he felt to his life’s work and his deep desire to remain involved but at a decreasing pace over time. We proposed a three-phase transition in which he would partner with us on the recruitment and selection of his successor to lead the company, transition to a part-time role working in his desired area and then retire from the company and attend board meetings each quarter. We believe this is one of many compelling elements of our offer that led to the selection of our LOI.
To make it easier for potential financing partners to study the proposed acquisition, we wrote a detailed investment opportunity memorandum describing our investment thesis and value creation plan as well as any risks we saw and how we planned to manage them. After approaching a number of interested parties, we received five fully funded proposals to support the entire acquisition.
Shortly after the closing in 2019, we held a strategic-planning offsite with the founder and management team where we all collaborated to identify the greatest opportunities to grow the company and increase its value over the coming five years, and then we developed a three-year growth strategy and supporting investment plan. Working together with the founder, the new CEO and everyone at the company, we’ve helped the business expand to a true national footprint and double its number of employees, revenue, and EBITDA. The company was always called National Power, and now it truly is a nationwide and rapidly growing enterprise.
ALCOM is the nation’s leading manufacturer of premium open and enclosed aluminum trailers for utility and recreational hauling, producing more than 40,000 US-built trailers annually under nine brand names.
The deal—told by John
We first learned of the ALCOM investment opportunity through a friend and fellow member of our church board, an industrial executive who had been CEO of a much larger company in a similar industry. At the time, ALCOM was majority owned by another PE firm that was preparing to cycle out of its investment. The company’s excellent management team had added a factory in South Dakota and another in Montana to their initial factory in Maine. When we met, they said they were looking for a partner with vision and expertise to help them grow the business beyond its current size.
The company was facing two major challenges. The demand for aluminum trailers had expanded well beyond the company’s capacity to serve its growing dealer network, resulting in long lead times and lack of available product. The company had also begun taking orders from dealers all over the country while all its manufacturing capacity was in three northern states. Shipping bulky trailers to customers beyond 500 miles was cost-prohibitive at scale.
Our investment thesis was partly based on the benefits of aluminum vs. steel as a trailer material. Aluminum is lighter (translating to better fuel mileage and towing capacity), lasts longer and looks good longer with less maintenance. Despite a 20% price premium, aluminum trailers are often what owners trade up to after an initial steel trailer. And most of ALCOM’s competitors are single-plant operations that were also struggling with increasing backlogs and delivery lead times.
Once we understood the opportunity and the challenges, the solution became clear. We financed the acquisition with major equity support from a family office as well as mezzanine sub-debt and an equity co-investment, and then we worked to formalize a strategy with company management. The company increased the number of full-time shifts and added prep shifts in the three existing plants. In the first 18 months after close, we opened additional plants in Florida and Texas, creating a much more effective distribution network. We also completed an add-on acquisition that added a sixth manufacturing plant and expanded the company’s brand and product portfolio to include boat and personal watercraft trailers.
Revenue and EBITDA have almost tripled in the first 24 months of ownership, and we are working closely with the ALCOM management team now on the next phase of improving efficiency, adding capacity, increasing quality and driving further growth.
ALCOM is the nation’s leading manufacturer of premium open and enclosed aluminum trailers for utility and recreational hauling, producing more than 40,000 US-built trailers annually under nine brand names.
The deal—told by John
We first learned of the ALCOM investment opportunity through a friend and fellow member of our church board, an industrial executive who had been CEO of a much larger company in a similar industry. At the time, ALCOM was majority owned by another PE firm that was preparing to cycle out of its investment. The company’s excellent management team had added a factory in South Dakota and another in Montana to their initial factory in Maine. When we met, they said they were looking for a partner with vision and expertise to help them grow the business beyond its current size.
The company was facing two major challenges. The demand for aluminum trailers had expanded well beyond the company’s capacity to serve its growing dealer network, resulting in long lead times and lack of available product. The company had also begun taking orders from dealers all over the country while all its manufacturing capacity was in three northern states. Shipping bulky trailers to customers beyond 500 miles was cost-prohibitive at scale.
Our investment thesis was partly based on the benefits of aluminum vs. steel as a trailer material. Aluminum is lighter (translating to better fuel mileage and towing capacity), lasts longer and looks good longer with less maintenance. Despite a 20% price premium, aluminum trailers are often what owners trade up to after an initial steel trailer. And most of ALCOM’s competitors are single-plant operations that were also struggling with increasing backlogs and delivery lead times.
Once we understood the opportunity and the challenges, the solution became clear. We financed the acquisition with major equity support from a family office as well as mezzanine sub-debt and an equity co-investment, and then we worked to formalize a strategy with company management. The company increased the number of full-time shifts and added prep shifts in the three existing plants. In the first 18 months after close, we opened additional plants in Florida and Texas, creating a much more effective distribution network. We also completed an add-on acquisition that added a sixth manufacturing plant and expanded the company’s brand and product portfolio to include boat and personal watercraft trailers.
Revenue and EBITDA have almost tripled in the first 24 months of ownership, and we are working closely with the ALCOM management team now on the next phase of improving efficiency, adding capacity, increasing quality and driving further growth.
Keystone Foam is a precision fabricator of foam subassemblies that become part of other companies’ products and packaging. The company serves a wide variety of customers in the medical, acoustic, bedding, packaging and other industries where highly engineered foam configurations enhance their products and services.
The deal—told by John
Foam is used in many everyday and specialized products ranging from packaging to protect items in transit to the seat cushions we sit on. What many people do not know is that foam is initially “poured” into large blocks several feet in each dimension. Foam fabricators are companies that cut these large blocks into precise shapes and fabricate subassemblies for use in other companies’ finished products.
We learned of the opportunity with Keystone Foam as it was being marketed by a banker who was a grad school classmate of Mark’s. Keystone was founded by the proud patriarch of a close-knit family in Pennsylvania. His sons were running the business and, after many lengthy discussions, had decided they needed to find the right partner to help them overcome growing pains as they sought to expand the company.
As we began to analyze the company’s financials and capabilities, we also thought about logical financing partners. The business is located an hour east of Pittsburgh, the home of one of the main investors in one of our previous acquisitions, National Power. After conversations that confirmed our mutual interest, we and this investor decided to combine forces and pursue the acquisition together.
Along the way, we learned that the CEO and COO of Keystone are, like us, people for whom their religious faith provides perspective and values not only in life but also in business—certainly not a requirement for a deal, but a welcome similarity in our view and, they told us, in theirs. Having as our lead financing partner a local capital provider gave the selling family additional comfort that we were all truly aligned. It was a very efficient process, as working with known and trusted partners often is.
Our offer for the business was attractive, and our value-creation plan was rigorous and detailed. Our bid was selected, and we welcomed Keystone Foam into the Valley Ridge portfolio in the summer of 2022.
As with many founder- and family-led businesses we’ve encountered and helped over the years, the structural reality at Keystone Foam is that it has more demand for its excellent products than it can serve. It routinely goes above and beyond to support its customers with timely delivery of high quality, precision-crafted products at competitive prices. The business has developed a well-deserved reputation as the go-to provider for a wide variety of customers with complex foam application needs.
We are in the process of expanding the senior management team with additional functional leaders and improving operational efficiency to optimize current capacity. Initially, this will enable the company to provide more products and better service to existing and new customers in its local region. Longer term, we are working with company management on plans to expand the business to new geographies where its capabilities, products and pricing will enable accelerated growth.
Keystone Foam is a precision fabricator of foam subassemblies that become part of other companies’ products and packaging. The company serves a wide variety of customers in the medical, acoustic, bedding, packaging and other industries where highly engineered foam configurations enhance their products and services.
The deal—told by John
Foam is used in many everyday and specialized products ranging from packaging to protect items in transit to the seat cushions we sit on. What many people do not know is that foam is initially “poured” into large blocks several feet in each dimension. Foam fabricators are companies that cut these large blocks into precise shapes and fabricate subassemblies for use in other companies’ finished products.
We learned of the opportunity with Keystone Foam as it was being marketed by a banker who was a grad school classmate of Mark’s. Keystone was founded by the proud patriarch of a close-knit family in Pennsylvania. His sons were running the business and, after many lengthy discussions, had decided they needed to find the right partner to help them overcome growing pains as they sought to expand the company.
As we began to analyze the company’s financials and capabilities, we also thought about logical financing partners. The business is located an hour east of Pittsburgh, the home of one of the main investors in one of our previous acquisitions, National Power. After conversations that confirmed our mutual interest, we and this investor decided to combine forces and pursue the acquisition together.
Along the way, we learned that the CEO and COO of Keystone are, like us, people for whom their religious faith provides perspective and values not only in life but also in business—certainly not a requirement for a deal, but a welcome similarity in our view and, they told us, in theirs. Having as our lead financing partner a local capital provider gave the selling family additional comfort that we were all truly aligned. It was a very efficient process, as working with known and trusted partners often is.
Our offer for the business was attractive, and our value-creation plan was rigorous and detailed. Our bid was selected, and we welcomed Keystone Foam into the Valley Ridge portfolio in the summer of 2022.
As with many founder- and family-led businesses we’ve encountered and helped over the years, the structural reality at Keystone Foam is that it has more demand for its excellent products than it can serve. It routinely goes above and beyond to support its customers with timely delivery of high quality, precision-crafted products at competitive prices. The business has developed a well-deserved reputation as the go-to provider for a wide variety of customers with complex foam application needs.
We are in the process of expanding the senior management team with additional functional leaders and improving operational efficiency to optimize current capacity. Initially, this will enable the company to provide more products and better service to existing and new customers in its local region. Longer term, we are working with company management on plans to expand the business to new geographies where its capabilities, products and pricing will enable accelerated growth.