NEW YORK, February 7, 2006 - Castle Harlan, Inc., the New York-based private equity investment firm, announced today that it has purchased RathGibson, Inc., a leading manufacturer of highly engineered premium stainless steel and alloy welded tubing products, in a transaction valued at $260 million.
RathGibson, based in Janesville, Wisconsin, makes a variety of straight and coiled welded tubing products and has a leading share in a number of niche markets. These include the chemical and petrochemical industries, energy, food and beverage and the pharmaceutical industry.
RathGibson's products are fabricated according to customer specifications, and the tubing can be customized to specific lengths of up to 80,000 feet. The company's primary trade brands, Rath and Gibson Tube, are recognized as industry leaders.
RathGibson's revenues for the 12 months ended October 31, 2005, exceeded $200 million and its adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) were approximately $43 million.
William Pruellage, the managing director who led the negotiations for Castle Harlan, said the company has a solid management team, outstanding brand recognition and a strong and loyal customer base.
"The company has a leading share in very attractive markets, including energy and power, which have positive growth trends and are providing important benefits to the business," Pruellage said. "In addition, we believe the company has significant opportunities for growing sales internationally. RathGibson ships its products to approximately 30 countries around the world and recently opened a sales office in China to strengthen its relationships with customers throughout Asia."
Castle Harlan bought the company from Liberty Partners, a New York private equity firm that had acquired Rath Manufacturing in 1995, and in 1999, Rath acquired Gibson Tube of Somerville, New Jersey.
Castle Harlan, founded in 1987, invests in controlling interests in the buyout and development of middle-market companies in North America and Europe. Its team of 11 managing directors, including its founders, has completed 45 acquisitions since its inception with a total value in excess of $7 billion. The firm traces its roots to the start of the institutionalized private-equity business in the late 1960s.
Castle Harlan's portfolio companies, which employ more than 31,000 people, include Ames True Temper, a leading manufacturer of lawn and garden tools and accessories; Horizon Lines, one of the largest U.S. container shipping companies; and Perkins Restaurant & Bakery, which is the operator and franchisor of 483 family restaurants.