News

KPS Capital Partners LP has agreed to sell North Carolina-based American & Efird, a maker of industrial and consumer sewing thread, embroidery threat and technical textiles, to Platinum Equity Capital Partners. No financial terms were disclosed. The deal is expected to close in the second quarter of 2018. Goldman Sachs served as lead financial adviser to KPS and A&E on the transaction with Nomura Securities International also providing financial advice.

PRESS RELEASE

NEW YORK, Feb. 26, 2018 /PRNewswire/ — KPS Capital Partners, LP (“KPS”) announced today that it has signed a definitive agreement, through an affiliate, to sell its portfolio company American & Efird (“A&E” or the “Company”) to Platinum Equity Capital Partners. Financial terms of the transaction were not disclosed.

A&E is the largest U.S. manufacturer and the world’s second-largest manufacturer and distributor of premium quality industrial and consumer sewing thread, embroidery thread and technical textiles for the apparel, automotive components, home furnishings, medical supply, footwear and diversified industrial end-markets. Through its global network, A&E’s products are manufactured in 21 countries, distributed in 50 countries and sold in over 100 countries. A&E is a recognized industry leader in environmental sustainability and corporate social responsibility.

KPS acquired A&E in 2011 from Ruddick Corporation (now a subsidiary of The Kroger Co.) in a highly complex corporate carve-out transaction.

Under KPS’ ownership, A&E was transformed into a truly global business, doubled its revenue and nearly tripled its operating cash flow (EBITDA). KPS made A&E a better business by optimizing its global manufacturing footprint, investing in its manufacturing facilities, innovation, new product development and technology, and by implementing a process and culture of continuous improvement. As a result of KPS’ global vision and strategy for A&E, the Company acquired majority control of four market-leading former joint ventures in Sri Lanka, Bangladesh, China and India, and also acquired Gütermann GmbH, the fourth-largest company in the global premium thread industry. As a result of these acquisitions, A&E expanded into adjacent geographies, products and end-markets, and successfully transformed the global premium thread industry.

Michael Psaros, a Managing Partner of KPS, stated, “A&E exemplifies the KPS investment strategy of seeing value where others do not, buying right and making businesses better, consistently executed across decades, economic cycles, geographies and industries.

“We take pride in A&E’s extraordinary transformation under our ownership. A&E capitalized on KPS’ experience and ability to build industry-leading companies on a global basis. We congratulate and thank Les Miller, A&E’s Chief Executive Officer, his immediate predecessor Fred Jackson, and the senior management team for their strategic vision, brilliant execution and passion.

“We also thank A&E’s former joint venture partners Brandix Lanka Limited, Brandot International Ltd., Ningbo Veken Elite Group Co., Ltd. and, especially, Vardhman Textiles Limited for their valuable contributions to A&E’s long-term success.”

Les Miller added, “KPS was the only investor to recognize the potential to create value by investing in our company. Working in partnership with KPS, we invested significantly in our operations, technology and people, becoming a far better company. We are grateful to KPS for providing our team with expertise, capital and the resources needed to acquire and integrate five acquisitions, and for creating a lasting culture of innovation and continuous improvement. We are confident in our growth trajectory, and will continue to provide our customers with the highest levels of product quality, innovation and customer service.”

Completion of the transaction, which is expected in the second quarter of 2018, is subject to customary closing conditions.

Paul, Weiss, Rifkind, Wharton & Garrison LLP served as legal counsel, Goldman Sachs & Co. LLC served as lead financial advisor and Nomura Securities International, Inc. also served as financial advisor to KPS and A&E with respect to the transaction.

About American & Efird
A&E is the largest U.S. manufacturer and the world’s second largest manufacturer and distributor of premium quality industrial and consumer sewing thread, embroidery thread and technical textiles. Producers of apparel, automotive components, home furnishings, personal care, hygiene, footwear and a diverse range of industrial products rely on A&E industrial sewing thread to manufacture their products. Customers select A&E as the preferred choice for industrial sewing thread, embroidery thread and technical textiles because of A&E’s dedication to providing its customers with the finest products and services, at the highest quality, delivered globally. Through its global network, A&E’s products are manufactured in 21 countries, distributed in 50 countries and sold in over 100 countries. In addition to A&E’s steadfast commitment to superior quality and customer service, A&E is a recognized industry leader in environmental sustainability and corporate social responsibility, and operates its global facilities with the utmost regard for the safety and health of its associates employed worldwide. A&E owns or operates 27 manufacturing facilities and employs over 10,000 associates around the world directly or in partnership with joint venture partners. For more information, please visit www.amefird.com.

About KPS Capital Partners, LP
KPS is the manager of the KPS Special Situations Funds, a family of investment funds with approximately $5.2 billion of assets under management. For over two decades, the Partners of KPS have worked exclusively to realize significant capital appreciation by making controlling equity investments in manufacturing and industrial companies across a diverse array of industries, including basic materials, branded consumer, healthcare and luxury products, automotive parts, capital equipment and general manufacturing. KPS creates value for its investors by working constructively with talented management teams to make businesses better, and generates investment returns by structurally improving the strategic position, competitiveness and profitability of its portfolio companies, rather than primarily relying on financial leverage. The KPS Funds’ portfolio companies have aggregate annual revenues of approximately $7.0 billion, operate 165 manufacturing facilities in 31 countries, and employ nearly 50,000 associates, directly and through joint ventures worldwide. The KPS investment strategy and portfolio companies are described in detail at www.kpsfund.com.