Kuala Lumpur-based private equity company Navis Capital Partners has sold its 100% stake in Trio Engineered Products, to Weir group PLC, at an enterprise valuation of $220 million.
Trio, which is expected to generate about $120 million in revenues in 2014, is a Chinese-American manufacturer of crushing and separation equipment for the mining and aggregates markets. Close to a third of its revenue comes from North America and about a fourth from China, with the remaining 40% spread across Australia, South American and Europe.
Navis acquired a controlling stake in Trio in August 2009. During its five years of ownership, Navis had worked with the management team to expand Trio’s addressable market, resulting in it entering new geographies and verticals, the firm said in a statement.
For the Glasgow-based Weir Group, the acquisition will help expand its mining services businesses.
Navis managing partner Nicholas Bloy said exiting Trio and selling it to Weir was part of a long tradition of the private equity firm to selling its businesses to strategic trade buyers.
“We have always believed that trade buyers make the best partners for our companies after our period of ownership, and this allows us to exit our investments cleanly, even amid periods of public market uncertainty,” he said in a statement.
Under Navis’ ownership, Trio achieved a five-year revenue compounded annual rate of return of 20% with earnings before interest, depreciation and amortisation increasing by almost three times. The company paid dividends every year with its strong cash-flow generation capabilities, Navis said.
“This was notwithstanding an ownership tenure coinciding with several periods of weakness in the global economy as well as in mineral prices,” the Navis statement added.
The Malaysia-based equity firm previously sold another of its businesses, industrial rubber parts and related mineral processing equipment manufacturer Linatex, to Weir in September 2010 for about $200 million, netting it almost 5.5 times its initial investment.
Navis manages approximately $5 billion in equity capital with over 60 control transactions completed since its establishment in 1998.