Bethesda, MD -- American Capital Strategies, Ltd. (Nasdaq:ACAS), a buyout and middle market finance company, announced today that it has completed the buyout of Warner Power, LLC, a New Hampshire based company. To complete the purchase and capitalize the new company, American Capital invested $13.6 million for a majority ownership position, in the form of senior debt and subordinated debt with warrants. Warner Power designs, engineers and manufactures highly customized industrial power conversion supplies and electronic ballasts. American Capital teamed up with an equity group that includes Warner Power's senior management as well as a strategic partner, Power Gems Limited, a leading electronic ballast manufacturing company based in the UK.
This transaction came to American Capital and Capital.com via its Internet sites, showing, once again, the value of being an early mover in the e-commerce middle market finance field.
American Capital President and Chief Operating Officer Adam Blumenthal said, "The acquisition of Warner Power illustrates American Capital's strategy of adding solid, promising niche companies to our portfolio. Particularly important to us, Warner Power represents a buyout where we acted as the principal in the transaction, a role that we feel very comfortable playing and one that we have targeted as absolutely key for American Capital's growth. With the transaction, American Capital has successfully added 19 companies to our portfolio in 1999, and we have invested over $159 million in these strong middle market companies this year."
A spin-off of WPI Power Systems and WPI Electronics (former subsidiaries of WPI Group, Inc.), Warner Power has been in business for over 50 years. Its custom-engineered power systems are used in many industries, including high-rise elevators, thermal processing and semiconductors. Its ballast systems support medical and commercial applications, such as endoscopes and outdoor signage.
Dennis Deegan, who formerly held senior management positions at WPI Group for 15 years, is Warner Power's Chief Executive Officer. "Warner Power is a strong company with a healthy position in the markets it serves," said Deegan. "Some of the most prominent companies in the world rely on its power conversion systems and electronic ballasts, including Otis Elevator, Corning Glass, Amana and Teradyne. Going forward, we will continue to focus on making high quality products that meet our customers' needs. American Capital has provided the necessary funding and financial expertise to complete this transaction, and we look forward to a mutually beneficial relationship."
American Capital Principal Virginia Rollins remarked, "As a high value-added, custom manufacturer with a blue-chip customer base, Warner Power has bright prospects, and we are pleased to participate in its growth and future success."
American Capital is a buyout and specialty finance company with capital resources exceeding $460 million. American Capital invests senior debt, subordinated debt and equity in businesses in need of capital for growth, acquisitions, ESOP buyouts, management buyouts, Internet development, liquidity and restructurings. Through www.Capital.com, financing is provided for receivable and inventory financing, working capital loans, machinery and equipment loans, real estate loans, construction financing, acquisition funding, management buyouts, ESOP financings, Internet development, liquidity and restructurings.
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Companies interested in learning more about American Capital's flexible financing and ability to provide senior debt, subordinated debt and equity should contact Mark Opel, Principal, at (800) 248-9340, or visit our website.This press release contains forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The statements regarding expected results of American Capital Strategies are subject to various factors and uncertainties, including the uncertainties associated with the timing of transaction closings, changes in interest rates, availability of transactions, changes in regional or national economic conditions, or changes in the conditions of the industries in which American Capital has made investments.
