Gladstone Investment Corporation has sold its equity interest and the payment of its debt investments in Acme Cryogenics to Graham Partners.

Graham Partners is a private equity firm based in Newtown Square, Pennsylvania, with a portfolio in building materials, medical products, packaging/consumer goods, transportation, aerospace, and more. As a result of this transaction, Gladstone Investment realized a significant capital gain on its equity investment, having first invested in Acme Cryogenics in 2006.

“Graham Partners is a highly professional group of very smart people who were very respectful of Acme, its customers, and its employees during the entire sales process,” said Joel Hansen, President of Acme Cryogenics. “Furthermore, they were very reasonable negotiators and met every commitment they made including transaction timing.”

Positioned for growth

Acme is positioned for growth under Graham’s ownership as a result of an ongoing industry conversion to outsourcing of equipment and service needs by industrial gas majors. Additionally, the company holds number one or number two positions within its product niches, and has longstanding customer relationships due to its strong reputation and leading technical capabilities for customized systems and solutions.

“Graham Partners is a highly professional group of very smart people who were very respectful of Acme, its customers, and its employees during the entire sales process.”

“With the sale of Acme and since June 2010, Gladstone Investment has exited seven of its management supported buy-outs and realized significant capital gains on the equity portion of these investments,” said David Dullum, President of Gladstone Investment.

“The realization of these capital gains are in keeping with Gladstone Investment’s strategy and capability as a buyout fund and our investment approach of realizing gains on equity while generating strong current income during the investment period.”

Relying on experts

Graham Partners engaged two operational experts during the acquisition process, who provided critical insight to diligence the industry and identify growth opportunities.

Josh Wilson, Managing Principal at Graham Partners, states, “The use of Graham’s extensive industry network, particularly two individuals with decades of experience in the industrial gas segment, afforded us the ability to validate Acme’s leading reputation and our investment thesis, as well as create an aggressive value creation strategy. We look forward to working with the management team to capitalize on these growth initiatives.”