Source Capital, and its operating partner Thomas van der Meulen, announced the completion of the sale of its portfolio company AirWorx, the largest independent aerial lift equipment rental company based in Indianapolis. Hammond, Kennedy, Whitney & Co., an Indianapolis-based private equity firm, acquired AirWorx in conjunction with the company’s existing management team. Brookwood Associates, L.L.C. served as the exclusive financial advisor to Source and Airworx for the transaction.
Source Capital recapitalized AirWorx in 2004 and assisted it in more than doubling in size by providing access to capital and strategic guidance to expand its aerial fleet; acquiring and integrating a local competitor; expanding and upgrading the management team; implementing advanced information and reporting systems; and ultimately expanding into new markets.
“We have been very pleased with our partnership with Dick Kagy, the president of AirWorx, and his management team,” said Tom Harbin of Source Capital. AirWorx demonstrates the opportunity many entrepreneurial business owners can achieve when they combine their industry knowledge and customer focus with access to growth capital and a willingness to further professionalize their businesses. The strength of AirWorx’s business model allowed us to exit this investment successfully during a challenging time in the economy and credit markets.”
Source Capital retains an investment interest in the equipment rental segment through its portfolio company Aerial Access Equipment, based in Baton Rouge, La. Source continues to seek opportunities to partner with credible businesses in this industry.
“Source Capital has been very successful identifying opportunities in the lower middle market to partner with business owners to create growth-oriented, “win-win” outcomes,” said David Felts, managing director of Atlanta-based Brookwood Associates. “AirWorx is another such example. This transaction is also indicative of the ability of market leaders with strong business models to successfully access the capital and M&A markets, at attractive valuations, even during this current credit-constrained environment.”
AirWorx was founded in 1996 by Dick Kagy. It operates two locations in Indiana and serves the non-residential construction and maintenance rental needs of its customer base with a fleet of more than 700 aerial rental units including boomlifts, scissorlifts and construction forklifts.
AirWorx is the fifth capital investment for HKW Capital Partners, a $202 million private equity fund. AirWorx also has branches in Warsaw, Ind., and Cincinnati. With the investment of cash, AirWorx anticipates expanding its fleet, and plans to open a branch in Louisville, Ky.
HKW officials said AirWorx is valued at more than $15 million.