OpenGate Buys Gabriel North America
The private equity firm joins a growing number of investors that are now looking to make plays in sectors that have struggled the most as of late.
June 30, 2009
OpenGate Capital is making a distressed play in one of the sectors hardest-hit by the recession; the private equity firm will buy Gabriel North America, a provider of shock absorbers and strut assemblies.
ArvinMeritor Inc., a listed Michigan-based automotive parts supplier, sold OpenGate the asset for terms undisclosed.
The struggling parts maker’s chief executive, commenting on the asset sale, said the move was part of its strategy to refocus itself. Markets responded positively to the OpenGate deal, sending ArvinMeritor shares up about 12% on the week at the close of trading Tuesday.
Gabriel produces aftermarket parts and supplies across North America; OpenGate will look to optimize manufacturing, expand product range, and broaden the range of niche applications for its products.
Earlier in June, OpenGate bought Fleurus Presse and Junior Hebdo, the youth publications divisions of leading French media company Groupe Le Monde.
A wave of M&A activity on Monday bolstered optimism that the dealmaking market may soon return; especially with an increase in deals for companies in sectors that have been punished by the recession.
Golden Gate Capital, a California private equity firm, recently acquired retail chain J. Jill from retailer Talbots Inc. for about $75 million; the seller took a substantial loss on its $517 million play—excluding debt—three years ago. More than 25% of J. Jill stores will be shuttered; some of the company’s management from Talbots will remain in place.
OpenGate Capital is not the only PE shop that has taken media stakes, but HM Capital—formerly known as Hicks, Muse & Co.—worked its way into one the hardest-hit media sectors of all: print. That private equity shop recently bought the Portland Press Herald and assets of the Seattle Times Co. for an undisclosed sum. Already, HM Capital has made media plays, Wilkes-Barre Publishing being another target, that one from 2006. And in March, Platinum Equity purchased The San Diego Union-Tribune from The Copley Press.
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