Recent Control Investments
Changing World Technologies, Inc
Changing World Technologies Inc. has successfully commercialized a manufacturing technology to convert food processing waste, including animal offal, waste fats, oils and greases and dissolved air flotation skimmings into Renewable Diesel Oil (RDO). CWT's technology was developed over a ten year period and has involved more than $140m in investment. The Company built its first commercial scale plant (15m gallons/year) in Carthage, Missouri. This plant is designed to use food processing waste as feedstock to produce RDO sold as stationary boiler fuel. In July 2010 the RDO using CWT's process was designated by the U.S. EPA as an "Advanced Biofuel" entitling it to Renewable Identification Numbers (RINs) which can be sold to "obligated parties" (primarily the large refineries) under the EPA's Renewable Fuel Standards 2.
Neos Ocular, Inc
Neos Ocular has a novel laser based technology for ameliorating presbyopia, the need for reading glasses. After making an initial investment several years earlier, in April 2007 GEM made an additional investment to take a controlling interest in the company. Neos Ocular, Inc has received conditional approval from the US FDA to begin Phase II Clinical trials. GEM has brought together a world–class team of investigators, clinicians, medical monitors, as well as an impressive Scientific Advisory Board to oversee development of the technology.
Ansen Electronics Company
Ansen Electronics is an electronic manufacturing ODM and OEM company that is based in Hong Kong with principal design and manufacturing operations in Dongguan, Peoples Republic of China as well as a US sales and prototype/short-run manufacturing operation based in upstate New York. The company is a vertically integrated business and has considerable capabilities in metal forming and turning, injection molded plastics, SMT and microelectronics assembly, which are all vertically integrated at its Dongguan manufacturing facility. The company’s core competitive advantage and its history of growing repeat business with a global base of customers is predicated on integrating ODM services through its CPD center, primarily focused on consumer and consumer electronic products. Some familiar products include desktop electronic weather instruments, nightlights, home security products, projection clock radios, timers, remote controls, wireless door chimes, portable lighting, electronic parking meters, exit signs, baby monitors, and MP3 players. The Company’s more recent product line array encompasses a range of integrated security systems for home and office that reflects a range of institutional and retail consumer sales. GEM identified the opportunity for a transaction on a proprietary basis and recently completed the MBO of an 80% equity interest in the company at a valuation level approximately 55% below the level of the company’s nearest public market comparables.
Elite SA
Elite SA is the renowned global model management agency headquartered in Geneva and Paris with model management agencies around the globe. Elite has historically represented top tier models that have served as prime faces for leading fashion houses and retailers around the world. The company also operates an expanding content business focused on both TV, multi-media, reality TV, and the internet, as well as a robust consumer products licensing business in Europe and Japan focused on women's personal care products and cosmetics. As a consequence of the relationship developed and business insight developed in executing a $5 million Debtor-in-Possession (DIP) loan financing for Elite Model Management, the US division Elite SA, GEM cultivated and proprietarily initiated the acquisition of 100% of Elite SA and installed a management team. The investment structure that GEM employed in its acquisition of Elite SA was innovative because it dovetailed an MBO with an accelerated IPO process governed by the rules of Entry Standard Provisions of the Deutsche Borse. Elite SA today is a listed company on the Deutsche Borse and GEM maintains a substantial ownership level.
VCST Industrial Products BBVA
VCST is a leading cross-border US and European full service Tier 2 supplier of precision-machined components for the automotive industry focused on light vehicles, SUV’s, and commercial trucks. VCST is headquartered in Belgium with design, manufacturing, and distribution operations in the US and Germany. The company, formerly a unit of Volvo, is a vertically integrated supplier with capabilities spanning design and prototyping, precision-machining of high tolerance engineered components and surface and heat treatment of steel and aluminum vehicular in-engine products and “integrated smart assemblies” for a number of new OEM platforms. GEM identified the opportunity for an acquisition of the business via a relationship developed with VCST’s Dutch parent, with whom GEM had interacted previously with minority equity financings. GEM developed a structure that allowed the family shareholders of the Dutch parent to optimize the re-focusing of their core business by offering an expedient and quiet transaction for VCST that would support existing operating management and provide for a seamless ownership transition. Due to the enterprise value of the business being in excess of the target profile for GEM’s affiliated US LBO fund, Kinderhook Industries, GEM and Kinderhook both invested in the MBO and brought in Fox Paine LLC as the anchor investor. VCST was sold to Alpha Gruppe, a Franco-German private equity fund, at an IRR of 55% after a 14 month holding period.
