Firms Look To Trade Label Co.

Consumer product label maker Fort Dearborn Co. is close to getting a new private equity owner.

According to an August 13 regulatory filing, KRG Capital Partners is in deal talks with the company’s current owner, Genstar Capital LLC. Genstar bought Fort Dearborn in 2006 for $145 million, according to Capital IQ.

Founded in 1925, Fort Dearborn makes labels for soup cans, hand soap, mayonnaise and other consumer products. The company is based in Elk Grove Village, Ill., and has manufacturing locations in California, Georgia, Pennsylvania, Kentucky, Texas, Nevada, South Carolina, Ontario and Quebec.

Should the deal proceed, KRG Capital would cut a check from KRG Capital Fund IV LP, a fund the Denver-based shop closed in 2007 at just under $2 billion. KRG Capital targets companies generating revenue of $10 million to $100 million in a variety of industries, including health care, construction materials and services, and aerospace and defense.

For Genstar, the deal would provide an exit for Genstar Capital Partners IV LP, a $475 pool of capital the San Francisco-based firm closed in 2004. According to Capital IQ, Genstar’s last exit came in June 2008, when it sold Propex Inc., a Chattanooga, Tenn.-based company that makes polypropylene fabrics for the construction, furniture and bedding, and automotive industries, among other sectors.

Genstar has been more active on the buy-side lately, signing three deals since May, when the firm bought Granite Global Solutions Inc., a Toronto-based company that helps insurers mitigate risk. In June, Genstar invested in Netsmart Technologies Inc., a Great River, N.Y.-based company that provides software as a service to the health care industry. And in July, Genstar bought Evolution Benefits Inc., an Avon, Conn.-based company that makes a prepaid benefits card called the “Benny,” which customers use to pay for medical benefits.

Genstar targets investments in the software, health care, financial services and industrial technology industries. The firm is currently investing out of its fifth fund, which it closed at $1.55 billion in 2007.

Executives at KRG Capital and Genstar declined to comment. Executives at Fort Dearborn did not immediately respond to requests for comment.