New York, NY (December 10, 2014) -- KPS Capital Partners, LP (“KPS”) announced today that its portfolio company Electrical Components International, Inc. (“ECI”) has entered into a definitive agreement to acquire Global Harness Systems, Inc. (“GHS” or the “Company”). Financial terms of the transaction were not disclosed.
ECI is the world’s leading manufacturer of wire harnesses and value-added assembly services for consumer appliance and specialty-industrial applications. ECI has over 800 customers globally and its products can be found in a wide variety of electronic and electro-mechanical applications, including home appliances, agriculture and construction, heating, ventilation and air conditioning (HVAC), specialty transportation, automotive, commercial appliance, and commercial electronics. ECI has 12 manufacturing facilities located in Canada, China, Mexico, Morocco, Poland and Spain with over 12,000 associates worldwide. KPS acquired ECI in May 2014.
GHS, founded in the 1930s, is a leading North American manufacturer of wire harnesses and panel assemblies for the bus, power generation, specialty vehicle and marine equipment end-markets. The Company’s customers include the leading North American OEMs in the end-markets it serves. GHS manufactures highly-complex and very large-scale wire harnesses, while also producing a vast number of unique part numbers for each of its key customers. The Company owns and operates two manufacturing facilities located in Juarez, Mexico and Atlanta, Texas, and employs approximately 800 associates.
Raquel Palmer, a Partner of KPS, said, “We are very excited about the progress that ECI has made under KPS ownership to date. Over the past several months, ECI has successfully launched its new, world-class, low-cost manufacturing facility in Morocco to serve the European market, while winning significant new business in both appliance and specialty-industrial end-markets. The strategic and industrial logic of ECI acquiring GHS is extraordinarily compelling, allowing ECI to enter new markets while also leveraging its industry-leading quality, service and product development capabilities to enhance GHS’s operations. We look forward to continuing to aggressively grow ECI both organically and through acquisitions in both North America and around the world.”
David Webster, Chief Executive Officer of ECI, said, “The acquisition of GHS is an important step in ECI’s continued expansion and diversification. We are very impressed by GHS’s rapid growth trajectory, unique product capabilities and relationships with its customers. The acquisition allows ECI to further diversify its revenue base by accessing new markets, such as power generation and marine equipment, while also broadening ECI’s customer base. Further, we believe that we can materially enhance GHS manufacturing operations by leveraging ECI’s culture of manufacturing excellence and continuous improvement, while also utilizing ECI’s global low-cost manufacturing footprint to help service GHS’ customers’ wire harness needs in international markets. ECI intends to invest significant additional capital and resources into GHS to ensure total customer satisfaction.”
Completion of the transaction is expected in January 2015.
Paul, Weiss, Rifkind, Wharton and Garrison LLP is serving as legal counsel to KPS and ECI and its affiliates. Financing for the transaction will be provided by a syndicate of banks and institutional investors with BofA Merrill Lynch and GE Capital Markets, Inc. acting as Lead Arrangers.
About Electrical Components International
ECI was founded in the 1950s and is headquartered in St. Louis, Missouri with 12 manufacturing facilities, 14 distribution centers and sales and engineering offices located in North America, South America, Asia, Europe and Africa. ECI is the leading global manufacturer and marketer of wire harnesses and provider of value-added assembly services for the home appliance industry and is a leading provider of wire harnesses to a diverse range of end markets. ECI has over 800 customers globally and its products can be found in a wide variety of electronic and electro-mechanical applications, including home appliances, agriculture and construction, heating, ventilation and air conditioning (HVAC), specialty transportation, automotive, commercial appliance, and commercial electronics. ECI has over 12,000 associates worldwide. For more information, please visit www.ecintl.com.
About Global Harness Systems
Founded in the 1930s and headquartered in Bala Cynwyd, Pennsylvania, GHS is a leading North American manufacturer of wire harnesses and panel assemblies for the bus, power generation, specialty vehicle and marine equipment end-markets. GHS owns and operates two manufacturing facilities located in Juarez, Mexico and Atlanta, Texas and employs approximately 800 associates.
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.
