Heritage Partners has sold its portfolio company Castle Rock Industries, based in Englewood, Colorado, to Alfred Karcher & Co. of Winnenden, Germany.
Heritage invested $25 million (€19.7 million) in Castle Rock in 1998, and has received around $88 million in the sale, resulting in a return of 3.5 times its initial equity and an IRR of approximately 20 percent.
Castle Rock manufactures commercial and professional cleaning equipment and supplies under its proprietary brand names Windsor, ProChem, Century 400, TecServe and Graco. Castle Rock had revenue of $131 million in 2005. The company’s brands offer floor care equipment, professional carpet cleaning and cleaning equipment parts.
“The company was already a strong player when we acquired it,” said Peter Hermann, general partner at Heritage Partners. “We made a series of acquisitions and put a lot of effort into professionalizing the management team. And after 8 years it seemed an opportune time to exit. The industry really needed to consolidate, and what we were able to do is pass it to the hands of a major player in the industry.”
Alfred Karcher &Co. is a family-owned company specializing in the development, production and distribution of cleaning technology and equipment. Their product portfolio includes high-pressure washers, blasting systems, ice blasters, vacuum cleaners and sweepers as well as cleaning agents, vehicle washes and drinking water treatment.
Heritage Partners tends to focus on family-owned businesses for its investment through its trademarked Private IPO structure, which enables owners of successful middle-market companies to obtain liquidity while still maintaining a large equity investment and ongoing control of their business.