Walpar Inc. - Recapitalization
THE TRANSACTION:
Walpar, Inc. has been recapitalized by Chicago-based middle market private equity investor Rock Gate Partners, LLC in partnership with Detroit-based Peninsula Capital Partners, L.L.C., who provided both debt and equity in support of the transaction. Founders Investment Banking, LLC acted as the exclusive financial advisor to Walpar’s shareholders in the transaction.
THE COMPANY:
Based in Birmingham, Alabama, Walpar is a leading designer and fabricator of highway signage structures and other highly-engineered, large-scale fabricated metal structures. Its responsive service, on-time delivery, competitive pricing, and high-quality/reliable systems have promoted the development of long-term customer relationships that average over 10 years—with some extending to well beyond 25 years.
THE SOLUTION:
After 35 years of ownership, the Parker family (the lone shareholders during this time) began encountering a series of issues that are typical for multi-generational businesses—diverging professional objectives, family succession concerns, and a desire for liquidity and subsequent wealth diversification. After being introduced to the Parkers by one of their trusted advisors, Founders assessed the family’s situation and then crafted a plan that would address their needs and objectives. Specifically, the Founders team determined that due to a confluence of factors—Walpar’s strong on-going financial performance, an expected increase in infrastructure investment, a likely upcoming increase in tax rates, and the identified shareholder needs—it was an appropriate and attractive time to pursue a capital market-driven solution. Founders implemented a structured process that consummated a transaction that accomplished their key goals:
- realize significant liquidity and diversify wealth,
- facilitate a tiered exit plan for the owners/managers,
- maintain post-deal ownership for realization of future value, and
- create an attractive post-transaction environment for current employees, including career development opportunities.
