San Fran Shop Eyes Industrial Company

Target: Controls Southeast Inc.

Sponsor: Industrial Growth Partners

Seller: Fred H. Stubblefield III

Industrial Growth Partners is closing in on an investment in Controls Southeast Inc., a maker of thermal maintenance systems, according to a regulatory filing.

Equity for the deal is slated to come from the San Francisco-based firm’s third fund, a $400 million pool of capital closed in December 2006. The seller, according to the filing, is Fred H. Stubblefield III, president of the Pineville, N.C.-based company.

Controls Southeast makes large, heavy-duty piping, flexible metal hoses and other fabricated products and systems from its campus of five buildings totaling more than 110,000 square feet. Its products are used in the chemical, food and pharmaceutical processing industries. Control Southeast was founded in 1962 by its then-parent company, Carolina Controls Inc.

The deal would be a typical one for Industrial Growth Partners, which invests in manufacturing companies and has an affinity for makers of industrial components and equipment. In January, the firm bought O’Brien Corp., a maker of heavy-duty tubes and other heat-exchange equipment used in the energy industry, as Buyouts first reported. Another portfolio company, Buffalo, N.Y.-based API Heat Transfer Inc., supplies similar products used to companies operating in chemical processing, dairy, food and beverage, power generation and pharmaceuticals markets.

Partners Michael Beaumont, Patrick Forster and Gottfried Tittiger formed Industrial Growth Partners in 1997. Since then, the firm has invested approximately $1.2 billion of equity capital. Its targets usually generate annual revenue between $30 million and $100 million.

Executives at Industrial Growth Partners and Controls Southeast did not return calls seeking comment.