American Capital, Ltd. (ACAS) declared the divesture of its portfolio company Paradigm Precision Holdings, LLC to Dynamic Precision Group – a portfolio company of The Carlyle Group LP (CG). The sale took place on Jan 31 this year.
American Capital received $127 million for the deal in debt and equity income, whereas its affiliated funds received $2 million, inclusive of post-closing adjustments.
Earlier in 2007, American Capital and an affiliate invested in Paradigm Precision for the One Stop Buyouts of Smith West Inc., Palmer Manufacturing Co. Inc. and Eurocast S.A. Later, in Sep 2008, American Capital invested in Paradigm Precision for the acquisition of TM Industries, Inc.
Based in Peabody, Mass., Paradigm Precision is a premier global supplier of precision aerospace components for jet engine manufacturers in both domestic as well as global markets. It produces highly complex, close tolerance parts and assemblies primarily used in aircraft engine and industrial gas turbines. Along with working with all of the major turbine engine original equipment manufacturers, the company provides parts used in land-based power generation and other specialty applications. It also has additional facilities in Mass., Conn., Ariz., Mexico, and Tunisia.
Also, in 2012, American Capital divested its portfolio company Aptara Inc. to iEnergizer Limited for $144 million. Of the proceeds, American Capital and its associates received $134 million, subject to post-closing adjustments, out of which about $108 million was solely received by American Capital.
American Capital directly and through its asset management business, initiates, underwrites and manages investments in middle-market private equity, leveraged finance, real estate and structured products. Since its IPO in 1997 through the fourth quarter of 2012, the company has earned 27% compounded annual return on the exit of its equity investments, including dividends, fees and net gains.
American Capital carries a Zacks Rank #1 (Strong Buy). Other companies in the same industry with Zacks Rank #1 (Strong Buy) include Medallion Financial Corp. (TAXI) and ICG Group Inc. (ICGE).
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