Delta Rigging & Tools (DR&T) is the country’s largest one-stop provider of hoists, winches, wire rope, rigging and other lifting products and services. Based in Lake Jackson, Tex., DR&T serves customers in the oil and gas, refining, petrochemical, mining, manufacturing, and other industries nationwide with a primary focus on the U.S. Gulf Coast. DR&T is comprised of six companies, each a leader in its respective segment of the lifting industry. Formed in 2004, the privately held company came together in its current configuration in January 2008.
- 面临的难题
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Starting with the acquisition of Industrial Hoist in 2004, Delta Rigging & Tools acquired a diverse portfolio of companies, each specializing in different kinds of lifting products and services. In a highly fragmented industry, DR&T created an integrated company, capable of meeting most of its customers’ lifting needs.
By 2007, DR&T was the leading provider of lifting products and services in Texas and Louisiana and had begun serving customers in other parts of the country. About two-thirds of the company’s revenue comes from the energy industry.
With energy demand continuing to grow rapidly in the U.S. and worldwide, DR&T management began to look for ways to capitalize on increased activity in the oil and gas industry, find new growth opportunities and expand beyond their Gulf Coast stronghold. To finance their growth ambitions and create value for current shareholders, DR&T management began the process of looking for an equity investor in early 2008.
DR&T management wanted a local financial sponsor with a strong track record of success and contacted Austin Ventures, a Texas-based venture and growth equity firm, to discuss a potential partnership. Austin Ventures wanted help evaluating the investment opportunity and both companies needed a knowledgeable financial services partner to help complete the transaction.
- 解决方案
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During the DR&T auction process, Austin Ventures turned to CIT Energy to help evaluate the investment and prepare an acquisition proposal. CIT Energy is a leading provider of financial products and advisory services for the energy, power and natural resources industries. Austin Ventures and CIT had worked together previously.
Because of their experience and expertise in the oil and gas industry, the CIT Energy team recognized DR&T’s unique position as a leading provider of products and services across multiple lifting technologies. They were equally impressed with Austin Ventures’ track record and commitment to supporting DR&T’s strong and seasoned management team.
CIT’s energy industry specialists saw excellent potential for continued success and growth for DR&T, thanks to a proven business model, opportunities for more industry consolidation, and forecasts for robust oil and gas production activity.
In July 2008, Austin Ventures agreed to purchase a majority stake in Delta for an undisclosed amount. Austin Ventures asked CIT Energy to propose financing for the acquisition.
- 结果
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In July 2008, Austin Ventures chose CIT Energy as lead arranger on a $50 million senior secured credit facility to support its acquisition of Delta Rigging & Tools. CIT Energy’s custom solution for Austin Ventures offered flexible terms and, despite challenges in the capital markets, an accelerated closing schedule of less than four weeks to meet the customer’s needs.
Austin Ventures’ equity investment will enable DR&T to pursue a wide range of growth opportunities and strengthen its capabilities both in the Gulf Coast region and throughout the United States. Funds will also be used to provide value to current DR&T shareholders.
With this acquisition, Austin Ventures bolsters its portfolio and its reputation as the most active investor in Texas. The company has more than $3 billion under management.
