Turnspire Capital Partners LLC on Wednesday, June 3, said it’s sold services platform USG Water Solutions LLC to Warren Equity Partners LLC.
New York-based Turnspire didn’t disclose the financial terms of the transaction but said that its ownership enabled the Atlanta-based company to optimize margins, increase Ebitda and generate significant cash flow, as well as expand its geographic market footprint.
The Deal reported earlier this week that Warren Equity had won a highly competitive auction for the business and would acquire it at a low teens multiple.
Alongside New York firms Harvest Partners LP and New Mountain Capital LLC, which owns water infrastructure services platform Inframark LLC, Jacksonville Beach, Fla.-based Warren Equity was among a handful of sponsors still chasing the business hard after management presentations in early May, The Deal reported.
Final bids were due the last week of May, and Warren agreed to pay a multiple around 14 times Ebitda, sources said. The Deal reported in April that USG generated Ebitda of around $40 million.
The Deal previously reported that Turnspire had narrowed down a list of more than 50 first-round bidders for USG Water. The company was expected to provide between a half-dozen and dozen management presentations, and parties needed to submit bids at north of 14.5 to 15 times Ebitda to be considered for MPs, sources said.
USG, founded in 1963, operates more than 70 facilities across North America. The company provides maintenance and rehabilitation services for water storage tanks, pipe networks and concrete water and wastewater plant structures, as well as metering solutions for water infrastructure.
Turnspire acquired USG from the U.S. arm of Veolia Environnement SA for undisclosed terms in 2023. Harris Williams LLC and Chapman and Cutler LLP were financial and legal advisers to USG on the sale, respectively.
Piper Sandler Cos. advised Turnspire on a recapitalization of USG last summer.
Jacksonville Beach, Fla.-based Warren Equity invests in lower middle market operating companies, primarily in North America. The firm focuses on the transportation, power and utilities, buildings and facilities, digital infrastructure, water and wastewater and waste sectors.
Warren in April 2023 announced the final close of its fourth fund with more than $1.4 billion in commitments.
It sold USA Water Holdings LLC, a provider of operations and maintenance services for water and wastewater systems across the Southeast, to Levine Leichtman Capital Partners LLC in 2024.
The Deal reported last April that Warren had tapped Harris Williams to run a sale process for environmental services platform O6 Environmental LLC. Quad-C Management Inc. invested in the company in August.
Turnspire acquires and transforms companies at operational or strategic inflection points. Turnspire, which said it focuses on value creation through operational improvements rather than financial engineering, invests in companies with revenue of $50 million to $400 million and up to $125 million in enterprise value across various sectors.
It closed its second fund in 2023 with $275 million in commitments.
Partner Abel S. Osorio and managing partner Ilya Koffman worked on the deal at Turnspire, which tapped Harris Williams and Macquarie Capital for financial advice. Winston Taylor LLP and Chapman and Cutler provided counsel.
