CLEVELAND, April 21, 2011 /PRNewswire/ -- Resilience Capital Partners ("Resilience") is pleased to announce that Steel Parts Manufacturing, Inc. ("Steel Parts"), a portfolio company of The Resilience Fund II, LP, has been acquired by Monomoy Capital Partners. Steel Parts is a leading manufacturer and supplier of close-tolerance precision metal stampings and components used primarily in automatic transmission systems for automotive and heavy-duty markets.
The sale of Steel Parts generates strong returns for Resilience and its investors of 4.7 times gross return on invested capital and a 51% gross internal rate of return. "Steel Parts is a perfect example of Resilience's strategy of investing in solid core businesses that are in a restructuring or special situation and applying a hands-on operational approach to improve its market position and financial performance resulting in superior returns for our investors," said Bassem Mansour, Managing Partner of Resilience.
Resilience acquired Steel Parts in December 2006 in a chapter 11 363 Sale. Resilience successfully negotiated new long term agreements with customers and suppliers to ensure the company could become profitable at the outset of the investment. Resilience put in place a management team, led by current CEO and Resilience Operating Partner Bob Potokar, which transformed the company into a preferred supplier of choice of transmission components. During Resilience's ownership, Steel Parts remained profitable during the economic downturn, while continuing to focus on improving its core manufacturing capabilities. This led to the addition of a range of new customers and new markets including heavy duty and off road applications using core Steel Parts technology. Today, Steel Parts remains uniquely positioned in the automotive and heavy duty market as a supplier on fuel-efficient, high-volume transmission platforms.
"We are proud of what we have accomplished together with Resilience," said Bob Potokar. "Together we devised and implemented a number of operational and strategic initiatives that positioned Steel Parts not only for a successful emergence from bankruptcy, but created a business nimble enough to navigate through the most challenging conditions in the history of the automotive industry. The company is well positioned for significant growth now that the economic recovery is occurring."
A major tenet of Steel Parts' turnaround strategy was to diversify its revenue base by entering new end markets while continuing to grow its traditional market sector. The company has successfully executed on this strategy specifically in the heavy-duty on/off highway market.
"We are pleased that the sale of Steel Parts enables us to continue to deliver consistent strong returns to our investors as we have for the past 10 years. We have enjoyed working with the management, staff and members of the United Steelworkers at Steel Parts and wish them continued success in the future," said Steve Rosen, Managing Partner of Resilience.
About Resilience Capital Partners
Headquartered in Cleveland, Ohio, Resilience Capital Partners is a leading private equity firm which invests in lower middle market companies in a broad range of industries. Resilience's value oriented investment strategy is to acquire companies with solid business prospects in a wide variety of special situations including underperformers, corporate divestitures, turnarounds and orphan public companies. Since its inception in 2001, Resilience has acquired 21 companies with total revenue in excess of $1.5 billion. For more information, please visit www.resiliencecapital.com.
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