Graham Partners in 3.4x aerospace exit

The Philadelphia-based mid-market firm grossed an internal rate of return in excess of 33% in the transaction, its fourth exit in 18 months.

Graham Partners has completed the sale of Schneller, which designs and manufactures materials used in the production of aircraft interiors, for $289 million to the TransDigm Group, grossing a 3.4x return. 

The Philadelphia-based firm grossed an internal rate of return in excess of 33 percent on the investment, according to Graham managing principal Chris Lawler. Schneller is Graham’s fourth exit in the last 18 months. The firm has also sold its stake in ICG Commerce, Stormtech and GP Special Opportunities. 

Graham purchased Schneller in a controlled buyout through its second institutional investment fund in 2007. Graham Partners Investments II closed on $465 million in 2005, according to Private Equity International’s data provider Private Equity Connect. Terms of that transaction were not disclosed. 

Schneller

The firm will maintain its other aerospace portfolio company, Lawler said. The Atlas Group, which manufactures aluminium precision-machined parts, sheet metal fabricated parts and complex assemblies for corporate, regional and defense aircrafts, was also acquired through Graham II in 2007.

Graham is not the only private equity firm that has been active in the aerospace sector recently. In July, Oak Hill Capital Partners hauled in $900 million through its exit of Primus International, which manufactures structural components, assemblies and kits for doors, flight controls and control mechanisms. Earlier this year, Terra Firma invested up to $246 million of additional capital in AWAS, bringing its total investment in the aircraft leasing company to $1.2 billion.

Graham Partners was founded in 1988 and controls $1.5 billion under management, according to its website. The firm focuses on mid-market companies with revenues between $30 million and $500 million, typically in the plastics, packaging, machinery, building products and outsource manufacturing sectors.