After a roughly five-year holding period, Code Hennessy & Simmons has exited its investment in Precise Technology, based in North Versailles, Pennsylvania, through a $257.5 million (€220 million) sale to Rexam.
Precise Technology was acquired by Chicago-based Code Hennessy in July of 2000. No terms of the deal were disclosed, but SEC filings indicate that the firm, along with company management, made an initial $59 million equity investment in the acquisition, which was followed in 2002 by another $40 million equity infusion. The investments came out of the firm’s fourth fund, Code Hennessy & Simmons IV LP.
Code Hennessy likely had an inside track into the Precise Technology deal when it originally pursued the investment. Code Hennessy partner and co-founder Brian Simmons is the son of Allegheny Technologies’ former chairman and CEO Richard Simmons, who, according to reports, also sat on the board of Precise Technology. Both Simmons’ are listed in the filings as investors in the company.
Pittsburgh-based Precise Technology is a manufacturer of injection-moulded plastic packaging. The company targets the healthcare, food and beverage, and personal care markets and reported EBITA of $21.7 million on sales of $294 million for 2004. The company operates 15 plants in the US and has also established facilities in the Netherlands and Poland. In 2002, the company acquired rival LLS Corp. out of bankruptcy in a reported $130 million deal.
Rexam has targeted private-equity portfolios in the past, and this latest deal follows a similar acquisition from September, when it bought Stonebridge Partners investment Delta Plastics for roughly $154 million. In 2003, Rexam also acquired Montagu Private Equity’s Risdon Pharma in a reported €125 million deal.
The company itself has been the subject of possible buyout, which has perked its share price in recent trading sessions.
Rexam expects to complete the Precise Technology acquisition prior to the end of 2005. According to a statement by Rexam CEO Lars Emilson, the company pursued the deal to give it an entryway into the North American market, particularly in the pharmaceutical and healthcare packaging segment.