Firm Sells Data Connection Component Manufacturer 27 July 2012
Riverside Makes the Right Connection, Exits L-com
The Riverside Company has sold L-com, Inc. of North Andover, Massachusetts. L-com is a designer, manufacturer and distributor of telecommunications and datacom interconnect components, serving a variety of end markets. The sale generated a 2.6x gross cash-on-cash return and a 17% gross IRR for investors in the 2003 Riverside Capital Appreciation Fund.
Riverside invested in L-com in April 2006, and helped L-com grow its customer base, develop new products, improve operations, enter China as both an end market and manufacturer, and strengthen its management team. The 2007 add-on of HyperLink Technologies added wireless connectivity products, expanded the customer base and significantly increased international sales.
Highlights of Riverside’s hold period include using Riverside’s Asian resources to help L-com establish, then improve, its manufacturing center in China. Riverside also helped L-com expand its distributor network and improve its domestic sales and marketing efforts.
“Riverside’s efforts helped L-com thrive through the Global Economic Crisis, and left the company bigger and better upon exit,” said Riverside Partner Kristin Newhall. “Although we held L-com during a challenging time for the industry, the company added jobs and grew revenues and EBITDA during the hold period, leaving L-com poised for continued growth.”
Working with Newhall for Riverside on the sale were Vice President Meranee Phing and Senior Associate Robert Avery. Riverside Origination Principal Amy Margolis worked with the deal team to facilitate the sale of the business.
Stifel Nicolaus Weisel advised Riverside on the transaction, and Jones Day provided legal counsel.
The Riverside Company
The Riverside Company is a global private equity firm focused on acquiring growing businesses valued at up to $200 million (€200 million in Europe). Since its founding in 1988, Riverside has invested in more than 290 transactions. The firm’s international portfolio includes more than 75 companies, and it has more than $3 billion/€2.5 billion in assets under management.