Private equity firm American Securities has agreed to purchase Grede Holdings, a cast metal and machine parts manufacturer, in partnership with the company’s top management team. Weil, Gotshal & Manges is representing American Securities in connection with the transaction, while Stroock & Stroock & Lavan is acting as outside counsel to Grede.
Headquartered in Southfield, Mich., Grede designs, develops and produces aluminum, iron and steel components for the transportation industry and also caters to the agriculture, construction, energy and rail industries. It has 17 plants spread across North America and employs about 4,500 workers, according to the company. Grede is majority-owned by a fund managed by Minnesota-based private equity firm Wayzata Investment Partners, which said Grede has estimated annual revenues of more than $1 billion. The company was formed in 2010 by combining assets of the former Grede Foundries, Blackhawk Foundry and Citation Corp., according to Wayzata. (Citation acquired Grede Foundries out of bankruptcy in 2011, according to Crain’s Detroit Business.)
While the financial terms of Monday’s transaction were not disclosed, The Wall Street Journal, citing unnamed sources familiar with the matter, estimated the deal’s value at $800 million.
“We are excited to partner with Grede’s exceptional management team and believe the company’s operational excellence positions it well to benefit from continued growth in the auto and construction markets,” American Securities managing director Kevin Penn said in a statement.
Grede CEO Douglas Grimm said the deal with American Securities will allow the company “to continue to expand our business and serve our customers.”
The Weil legal team advising American Securities is being led by corporate partner Michael Weisser, who is working with environmental partner Annemargaret Connolly in Washington, D.C., and banking partner Allison Liff and tax partner Mark Schwed in New York. The associates from the firm working on the matter are Elliott DeRemer, William Dong, Anne Ford, Thomas Goslin, Clinton Hutchings, Sandra Rutova and Alana St. Aude. Associate Megan Ward, who is not yet admitted to practice, is also working on the deal.
Weil previously advised American Securities on its sale of General Chemical to Canada’s Chemtrade Logistics Income Fund for $860 million in December 2013, its purchase of Tekni-Plex from Oaktree Capital Management for an undisclosed sum in November 2013 and its purchase of Metaldyne from The Carlyle Group in 2012 for $820 million in equity and debt, according to published reports.
Eric Schondorf is American Securities’ general counsel.
The Stroock team representing Grede includes partner Matthew Schwartz and associates Sean Chao and Thomas Shiah.