New York, NY (June 16, 2014) -- KPS Capital Partners, LP (“KPS”) announced today that its portfolio company American & Efird Global, L.P. (“A&E”) will acquire substantially all of Gütermann Holding SE’s global industrial and consumer thread business (“Gütermann”). The transaction was approved by the stockholders of Gütermann on June 14, 2014, but is still subject to customary closing conditions. 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. A&E thread is used by producers of apparel, automotive components, home furnishings, medical supplies, footwear and certain industrial products. A&E owns or operates 22 manufacturing facilities and employs over 9,000 associates around the world directly or in partnership with joint venture partners. KPS acquired A&E from Harris Teeter Supermarkets, Inc. (now a subsidiary of The Kroger Co.) in November 2011.
Founded in 1864 and headquartered in Gutach, Germany, Gütermann is a leading European manufacturer and distributor of premium, high-quality sewing thread products for consumer and industrial applications. Gütermann’s products serve a variety of end-markets, including apparel, shoes, leather goods, work wear, home textiles and automotive end markets. Gütermann has a highly regarded brand name globally and a strong reputation among leading European apparel and non-apparel brands. Gütermann owns and operates four manufacturing facilities located in Germany, Spain, Mexico and India, and employs approximately 1,000 associates around the world.
Michael Psaros, a Managing Partner of KPS, said, “The transformation of A&E under KPS’ ownership is remarkable. A&E has exceeded all of our expectations for growth on a global scale by successfully expanding into adjacent geographies, products and end-markets. The strategic and industrial logic of A&E acquiring Gütermann is extraordinarily compelling as it will even further advance A&E’s industry-leading quality, customer service and innovation, delivered through an integrated and truly global manufacturing footprint. A&E’s conservative capital structure, absence of large unfunded pensions and other legacy obligations, coupled with its access to KPS’ material capital resources, positions the company to grow aggressively organically and through acquisition.”
Fred Jackson, Chief Executive Officer of A&E, said, “The acquisition of Gütermann is a critical strategic step in the growth of A&E. We are very impressed with Gütermann’s diverse product portfolio, customer base, premium quality and technical capabilities. Gütermann’s strong market position in Europe coupled with A&E’s worldwide manufacturing and distribution footprint and strong brand recognition in North America and Asia is an ideal combination. This acquisition furthers our commitment to support our customers globally with high-quality localized supply, technical resources, customer service support, and the highest environmental and social responsibility. A&E has made tremendous progress under KPS ownership and, with the strategic addition of Gütermann, I believe our future is even brighter.”
Completion of the transaction is expected on June 30, 2014 and is subject to customary closing conditions.
Hengeler Mueller is serving as legal counsel to KPS and A&E. Financing for the transaction will be provided by a syndicate of banks led by Merrill Lynch, Pierce, Fenner & Smith, Inc., along with Wells Fargo Securities, LLC, and PNC Capital Markets LLC acting as Joint Lead Arrangers.
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, medical supplies, 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 20 countries, distributed in 44 countries and sold in over 95 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 22 manufacturing facilities and employs over 9,000 associates around the world directly or in partnership with joint venture partners. For more information, please visit www.amefird.com.
About Gütermann
Founded in 1864 and headquartered in Gutach, Germany, Gütermann is a leading European manufacturer and distributor of premium, high-quality sewing thread products for consumer and industrial applications. Gütermann’s products serve a variety of end-markets, including apparel, shoes, leather goods, work wear, home textiles and automotive end markets. Gütermann has a highly regarded brand name globally and a strong reputation among leading European apparel and non-apparel brands. Gütermann owns and operates four manufacturing facilities located in Germany, Spain, Mexico and India, and employs approximately 1,000 associates around the world. For more information, please visit www.guetermann.com.
About KPS Capital Partners
KPS, through its affiliated management entities, is the manager of the KPS Special Situations Funds, a family of investment funds with approximately $21.8 billion of assets under management (as of June 30, 2024). For over three 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 generate aggregate annual revenues of approximately $21.6 billion, operate 245 manufacturing facilities in 26 countries, and have approximately 64,000 employees, directly and through joint ventures worldwide (as of June 30, 2024, pro forma for the recent acquisitions of Sport Group and Innomotics which closed on July 8, 2024 and October 1, 2024, respectively). The KPS investment strategy and portfolio companies are described in detail at www.kpsfund.com.
