GRAND RAPIDS — Concurrence Capital Holdings LLC has closed on a deal to acquire a Sparta-based telecommunications contractor.
The deal for Utility Contracting Co. (UCC) positions the Grand Rapids-based private equity firm to take advantage of opportunities in a fast-growing industry, according to Concurrence Capital Managing Partner Jason Byrd.
The full-service telecom contractor, based at 1001 12 Mile Road NW in Sparta, works with clients ranging from local telephone service providers and wireless carriers to municipal networks and private companies. Utility Contracting is a provider of telecommunications infrastructure that specializes in placing, splicing and testing services for copper and fiber optic cables.
The company operates four field offices in Grand Rapids, Kalamazoo, Lansing and Saginaw.
Concurrence plans “to make the most of what is turning out to be very strong demand for an increase in the fiber infrastructure network that is needed in rural and urban markets alike,” Byrd told MiBiz.
Terms of the deal were not disclosed.
The PE firm, co-founded last year by Byrd and Michael Brom, raised more than $3.8 million in equity from 20 investors in conjunction with the transaction, according to filings with federal securities regulators.
According to Byrd, the firm secured the funds from “West Michigan-rooted investors that are interested in seeing companies … in our region continue to grow and put in the foundational systems and infrastructure to last for more generations to come.”
“They are all committed to the long-term with an eye towards building strong organizations that will continue to keep our regional culture of hard work, ingenuity and purposeful growth,” he wrote in an email follow-up.
The existing leadership team at Utility Contracting — including Executive Director Andrew Ross, President Tim Rood, and CFO Andy Edwards — will remain in their positions after the deal with Concurrence Capital.
Byrd and Brom “will both take active roles” to support the contractor’s management team as part of their investment.
In a statement, Ross said he had been “actively seeking the right partner to help UCC evolve and grow, while maintaining our core values of safety, quality and productivity.” He said the investors “bring experience and fresh eyes to the table that will complement our team and greatly benefit UCC as we strive to achieve significant growth and expansion in the coming years.”
Industry experts expect strong demand to continue in the telecommunications contracting industry, especially for deep fiber. According to a report from Deloitte Insights, the success of 5G wireless internet will hinge on “deep fiber deployment.”
In part, the report notes that the U.S. will need to invest $130 billion to $150 billion in fiber infrastructure over the next several years “to adequately support broadband competition, rural coverage, and wireless densification.”
Concurrence Capital looks for long-term investment opportunities in middle-market companies in the niche manufacturing, food and beverage, automotive, medical device, value-added distribution and business-to-business service industries. The investment firm targets companies with revenues exceeding $5 million and earnings before interest, taxes, depreciation and amortization of $1 million to $8 million.
Prior to the deal for Utility Contracting, Concurrence Capital invested in Mission Design & Automation LLC, a Holland-based producer of automation systems for the automotive, office furniture, medical and consumer goods industries, as MiBiz previously reported.
Despite operating in different industries, Utility Contracting and Mission Design share “a number of similarities,” Byrd said.
“The people are the (focus of the) business, there is somewhat of a project orientation at each of the companies, industry tailwinds are favorable for each, and they both have a culture of success,” he said.