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Sponsors Look To Trade Security Product Distributor

Target: Tri-Northern Holdings Inc.

Sponsor: Audax Group

Seller: Brazos Private Equity Partners LLC

Audax Group is close to an investment in Tri-Northern Security Distribution Inc., a distributor of electronic security products, according to a regulatory filing.

The seller in the deal is Brazos Private Equity Partners LLC.

Audax typically invests $10 million to $100 million in deals valued between $15 million and $250 million.

Tri-Northern is the combination of two companies in the electronic security distribution market: Tri-Ed Distribution and Northern Video Systems Inc. With 40 branches throughout the U.S., Puerto Rico and Canada, the Woodbury, N.Y.-based company  sells more than 25,000 products from companies such as Tyco, General Electric and Panasonic to security companies, according to Brazos Private Equity’s web site.

Audax and Brazos Private Equity received early termination of antitrust review for the deal under the Hart-Scott-Rodino Act on March 23.

If the deal proceeds, and Brazos Private Equity makes a full exit, it would mark a quick flip for the Dallas-based investment firm, which only bought Tri-Ed and Northern Video for undisclosed amount in March 2010.

Audax would be making the investment out of Audax Private Equity Fund III LP, a $1 billion pool of capital that the Boston-based firm closed in May 2007. The firm is reportedly in the market seeking $1 billion for its fourth fund. Tri-Northern was an investment out Brazos Private Equity Fund III LP, which closed with more than $700 million in commitments in September 2008. 

Geoffrey Rehnert and Marc Wolpow, former managing directors at Bain Capital, founded Audax in 1999. The firm now manages more than $4 billion across its private equity, mezzanine debt, senior secured debt and affiliate funds.

Brazos was also founded in 1999, by Randall Fojtasek, the former CEO of Atrium Companies Inc.; and Jeffrey Fronterhouse and Patrick McGee, who were both principals with Hicks Muse. The firm manages a total of $1.4 billion.

Executives at Audax and Brazos Private Equity did not respond by deadline to efforts to reach them for comment.