New York, NY, August 14, 2023 – Churchill Asset Management (“Churchill”) today announced that it served as Co-Lead Investor for an oversubscribed secondary market transaction in support of Frontenac and its portfolio company, Motion & Control Enterprises (“MCE” or the “Company”).
MCE is a leading industrial distributor and services provider of highly engineered, full lifecycle fluid, flow, automation, and air solutions. Frontenac acquired MCE in 2018 in partnership with CEO1ST executive Charley Hale. Together, Frontenac and Mr. Hale have completed 10 acquisitions and grown EBITDA by more than 15x.
“The market MCE serves is benefitting from robust, long-term industry tailwinds and remains highly fragmented, presenting a compelling opportunity for growth. With this continuation vehicle transaction, we are pleased to support Frontenac’s ongoing investment in MCE, enabling the acceleration of organic growth initiatives and the pursuit of additional attractive M&A opportunities,” said Nick Lawler, Head of Secondaries at Churchill.
The continuation vehicle marks Churchill’s fourth direct investment alongside Frontenac across the Churchill platform, including middle market senior lending, junior capital, equity co-investments, and secondary capital. Churchill is also an investor in Frontenac’s flagship private equity funds. Based in Chicago, IL, Frontenac focuses on investing in lower middle market buyout transactions in the consumer, industrial, and services industries. The firm has built a franchise partnering with over 300 owners of mid-sized businesses over the last 50 years.
“We are delighted to work with Churchill once again, a firm that has supported our funds and several portfolio companies with a range of solutions across the capital structure,” said Ron Kuehl, Managing Partner at Frontenac. “By continuously enhancing its capabilities to proactively address the dynamic needs of the industry, Churchill remains a reliable and forward-thinking partner. This secondary transaction is a clear testament to our strong collaboration, in this case supporting an excellent company with exciting growth potential, even amid the uncertainties of the current market environment.”
Churchill launched its Secondaries strategy in 2022 with the hire of Nick Lawler to lead the strategy. In the last twelve months, Churchill has invested over $300 million in secondary transactions across GP-Led and LP-Led transaction structures with a core focus on the U.S. middle-market.
“We remain excited about the opportunities presented across the secondary landscape, and particularly in the continuation vehicle segment of the market,” added Jason Strife, Head of Junior Capital & Private Equity Solutions at Churchill. “These transactions enable sponsors to generate liquidity for existing investors, maintain ownership of top performing companies, and raise incremental follow-on capital in support of the next phase of growth. Further compelling is the relative scarcity of secondary capital available in the market today, resulting in a significant flight to quality both in terms of franchise assets and top-tier sponsors pursuing continuation vehicles.”
About Churchill Asset Management LLC
Churchill, an investment-specialist affiliate of Nuveen (the asset manager of TIAA), provides customized financing solutions to middle market private equity firms and their portfolio companies across the capital structure. With over $46 billion of committed capital, we provide first lien, unitranche, second lien and mezzanine debt, in addition to equity co-investments, secondary solutions and private equity fund commitments. Churchill has a long history of disciplined investing across multiple economic cycles and our unique origination strategy, execution and investment are driven by more than 150 professionals in New York, Charlotte, Chicago, Dallas and Los Angeles. More information can be found at www.churchillam.com.
About Frontenac
Frontenac is a Chicago-based private equity firm. The firm focuses on investing in lower middle market buyout transactions in the consumer, industrial, and services industries. Frontenac works in partnership with established operating leaders, through an executive-centric approach called CEO1ST, which seeks to identify, acquire, and build market-leading companies through transformational acquisitions and operational excellence. Over the last 50+ years, Frontenac has built a franchise working with over 300 owners of mid-sized businesses as they address complex transition issues of liquidity, management enhancement, and growth planning. For more information, please visit www.frontenac.com.
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This material is not intended to be a recommendation or investment advice, does not constitute a solicitation to buy, sell or hold a security or an investment strategy, and is not provided in a fiduciary capacity. The information provided does not take into account the specific objectives or circumstances of any particular investor, or suggest any specific course of action. Financial professionals should independently evaluate the risks associated with products or services and exercise independent judgment with respect to their clients.
Churchill Asset Management is a registered investment advisor and majority-owned, indirect subsidiary of Teachers Insurance and Annuity Association of America. Certain Nuveen products are advised by Nuveen Alternatives Advisors LLC, a registered investment advisor and wholly owned subsidiary of TIAA, and distributed by Nuveen Securities, LLC, Member FINRA and SIPC.
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