GRAND RAPIDS — Closing on its first acquisitions should provide private equity firm Auxo Investment Partners momentum as it pursues additional deals in an active M&A market.
The Grand Rapids-based Auxo, which formed last fall, acquired Atlas Die LLC of Elkhart, Ind. and Bernal LLC, based in Rochester Hills, north of Detroit. Terms of both deal were not disclosed.
“The first investments for our firm and for the fund are very critical, and we’ve taken a very patient and discerning approach to the first investments we’re making,” Auxo Managing Partner Jeff Helminski told MiBiz in an exclusive interview. “That’s going to continue for the foreseeable future, but we found the right ones to start with.
“Having the first couple under our belt, it starts to build momentum and it demonstrates that we’re doing exactly what we say we are going to do.”
Helminski describes Atlas Die and Bernal as “market leaders in their space with a long history of being thought leaders in their industries.” The two companies operate in similar markets but at opposite ends of the industry and represent a “great fit” for Auxo’s investment philosophy.
“They’re really the go-to players in their industries for customers that have complex challenges,” he said. “They’re great companies with terrific capabilities.”
Founded in 1972, Bernal makes solid rotary pressure dies, crush cut dies and high-volume rotary converting systems for die-cutting, food processing, folding cartons, specialty bandages and alcohol swabs, and other complex products. The company employs 64 people.
Atlas started in 1952 in founder S. Ray Miller’s basement and serves low-volume, customized markets. The company, which has 160 employees at six facilities in five states, introduced laser technology into the die-making process and developed flexible rotary die-making capabilities.
Helminski said Auxo may close on at least one more deal and potentially up to three acquisitions during the remainder of 2017. He calls the private equity firm’s deal pipeline “very strong … almost too strong.”
“It’s an active market,” he said. “There are a lot of opportunities out there and we’re trying to make sure we pick the right ones.”
Helminski, Jack Kolodny and Fred Tedori formed Auxo in October 2016 with plans to raise roughly $50 million. The firm targets North American middle-market companies in manufacturing, industrial, “value-added distribution,” business services and other industries with EBITDA between $1.5 million and $15 million. Auxo uses a model where investors are partners in the firm, and it aims to take a long-term partnership approach with managers to grow the companies it acquires.
Advisers on the Atlas and Bernal transactions included law firms Miller, Johnson, Snell & Cummiskey PLC and Barnes & Thornburg LLP. BDO, Mercantile Bank, Oxer Capital in Columbus, Ohio and Chicago-based Livingstone Partners served as financial advisers.
“We see a tremendous opportunity to further grow and scale Atlas Die and Bernal and to drive new sales and revenue growth,” Kolodny said. “We’re also actively pursuing other deals, and we’re confident that our unique hands-on, long-term investment approach will pay off for our investors and our new portfolio companies.”
Editor’s note: This story has been updated to include Fred Tedori as a founder of Auxo.