CLA’s Investment Banking Group advises on sale of large diameter industrial pipe fittings manufacturer Specified Fittings to The Harrington Corporation.
Specified Fittings, LLC, a manufacturer and distributor of polyvinyl chloride (PVC) and high-density polyethylene (HDPE) pipe fittings has been acquired by The Harrington Corporation. CLA’s investment banking team served as the exclusive financial advisor to Specified Fittings, which was a portfolio company of Northstar Capital LLC, Montlake Capital, and other investors since 2014.
The transaction closed on November 15, 2019. Price and terms were not disclosed.
Specified Fittings manufactures large diameter and standard PVC and HDPE pipe fittings for use in municipal, energy, agriculture and industrial end markets at its three locations in Bellingham, Washington; Stevensville, Montana; and Early Branch, South Carolina. The company also resells high-volume small diameter injection-molded fittings and large diameter pipe. Specified Fittings was founded in 1996.
The Harrington Corporation (HARCO) is a manufacturer of gasketed joint injection-molded PVC fittings and push-on gasketed joint ductile fitting. Founded in 1966, HARCO has grown to become a leading developer of pipe fittings for the waterworks and irrigation markets in the United States. The company manufacturers fittings at its facilities in Lynchburg, Virginia and Janesville, Wisconsin and maintains warehouses in Winter Haven, Florida; Dallas, Texas; and Phoenix, Arizona. HARCO is headquartered in Lynchburg, Virginia.
Led by CEO Tom Franzen, President Kevin Hawkins and CFO Darice Ratzlaff, Specified Fittings is known well throughout the PVC and HDPE industry for its short production run capabilities, its industry leading minimal lead times, and its diversified, blue-chip customer base. It is one of a very limited number of players in the industry with capabilities to produce large diameter (up to 63”) fittings. Tom, Kevin and Darice will remain with the company and continue to be integral team members to HARCO.
The sale to HARCO followed a robust sell-side process led by CLA that resulted in multiple interested parties, each with a slightly different strategic angle.
“The CLA investment banking team was instrumental in highlighting the strategic merits that an acquisition of Specified could provide each buyer, and then helping negotiate the best possible outcome with the best strategic fit,” commented David Shuler, partner at Northstar Capital. “The transaction would not have been possible without their involvement.”
Legal counsel for Specified Fittings was provided by Briggs and Morgan PA, of Minneapolis, Minnesota. Quality of Earnings advisory was provided by Craig Arends, Katelyn Kerfeld, and Joe Traxler of CLA’s Minneapolis office.
Paul Novak, managing director in CLA’s investment banking practice, said that the acquisition of Specified Fittings was a great strategic move for HARCO for many reasons.
“HARCO has an exceptional reputation for quality and service in PVC and ductile fittings. Now they are able to leverage that reputation into HDPE products and at the same time expand their PVC manufacturing footprint from coast to coast,” said Novak. “The waterworks industry is ripe for further consolidation as traditional manufacturers look to expand their portfolio of products and service the demands of old infrastructure. HARCO has now become a much larger and more diverse player in this industry. I’d expect to see great things from HARCO going forward.”
CLA investment banking professionals provide sophisticated corporate finance advisory and investment banking services to lower middle-market businesses and owners. The practice’s services include mergers and acquisitions, recapitalizations, and other transaction-related advisory services.
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