Live Deals – Odyssey Takes Metal Co. Private –

Odyssey Investment Partners last month recapitalized and merged publicly traded Dayton Superior Corp., a maker of metal accessories used in construction, with Stone Acquisition Corp. for $27 per share in cash, in a transaction valued at approximately $315 million in debt and equity.

Odyssey principal Doug Rotatori said the recapitalization was comprised of about $165 million in equity and approximately $150 million in debt and other fees.

Rotatori said the transaction price of $315 million reflects a 45% premium, based on Dayton Superior’s closing share price when the deal was announced Jan. 19.

Upwards of 10 members of Dayton Superior’s management agreed to take equity stakes in the company of between 5% and 10%, in lieu of cash, for a portion of their current equity interest.

The merger is likely to close in four to five months, Rotatori said.

Dayton Superior, which has annual revenue of more than $300 million, makes and distributes metal accessories for use in commercial construction and highway infrastructure.

Rotatori said Odyssey, which has previously invested in specialized manufacturing companies, found Dayton Superior attractive because the company has a high market share position and strong management.

“We believe we can aggressively grow the company with acquisitions and leverage,” Rotatori said. “Our acquisition strategy involves buying small niche add-on acquisition and possibly larger acquisitions that will expand product offerings and/or geographic presence.”

Rotatori said the specialty-manufacturing sector has experienced steady growth over the past four to five years and the outlook remains strong for continued moderate growth. Dayton Superior is currently the market leader in its sector in North America and Rotatori expects the company’s business to eventually expand into Europe and Mexico.

“As a private company, we will have greater flexibility to meet the demands of a dynamic marketplace, without the costs associated with being a public company,” Dayton Superior’s chief executive J. A. Ciccarelli said in a statement.

Ciccarelli will continue to head the company. Now that it is privately held, the Dayton, Ohio-based company will accelerate the size and pace of its existing acquisition strategy. “It’s more easily doable as a private company,” Rotatori said.