Behrman pays $107m for specialty packaging company

The US mid-market firm has purchased an Illinois Tool Works subsidiary as it deploys remaining ‘reserve capital’ for add-ons from its $1.2bn Fund III.

Selig Sealing Products, a Behrman Capital portfolio company, has paid $106.5 million (€69 million) to acquire fellow specialty container sealing company Unipac from publicly traded conglomerate Illinois Tool Works.

Behrman began negotiations with ITW in November 2007, having been given the opportunity to make a preempted offer, firm co-founder and managing partner Grant Behrman told PEO.

The add-on acquisition was made from the firm’s third fund, which closed on $1.2 billion in 2001.

Selig, purchased in April 2005 for roughly $100 million, represents Fund III’s final platform acquisition.

Grant Behrman

“That fund is fully invested in terms of number of platform companies. But we do have reserve capital that we can – and have – deployed for add-ons,” Behrman said.

While noting it’s entirely dependent upon the opportunities that arise, Behrman estimated Fund III will make two or three more add-on acquisitions for existing portfolio companies.

He did not rule out adding another company to the Selig platform, but said the private equity firm believes it has “created a critical mass” with the combination of Selig and Unipac.

“Unipac has a strong market presence in the US, [Selig has] a strong market presence in the US and a large footprint in Europe, so for us, this is a combination that creates a global player,” he said.

In conjunction with the deal, Selig obtained a $125 million credit facility led by GE Commercial Finance, with funds also provided by Madison Capital Funding and BMO Capital Markets.

Robert W Baird advised ITW, while BMO Capital Markets was financial advisor to Selig and Behrman. Goodwin Procter provided legal advice to Selig and Behrman.

Behrman was founded in 1991 and has offices in San Francisco and New York.