Distressed Industrials PE
Hello WSO,
I am currently in the restructuring consulting space with the ultimate goal of working at a MM/LMM distressed PE firm with an industrials focus. Firms that I find interesting are KPS, Monomoy, Middleground, American Industrial Partners, Stellex.
- How feasible is it for me to get into a seat at a firm listed above?
1a. without banking experience? or is it necessary?
KPS seems like necessary, Monomoy has a operational track that seems more likely, Middleground has some ex restructuring consultants. American Industrial Partners seems to have only bankers, engineers, and ex-military.
- What are other firms similar to those I have listed above?
// should add that I am under 2 YOE
Bump.
re: monomoy someone at firm told me theyre not really distressed anymore
what do they focus on now? carve outs?
I am definitely way more interested in distressed, but am warm to flat/slight negative ebitda turnaround + bolt-ons
Why are you so interested in making your own life difficult?
Monomoy focuses more on value plays and would say they target "out of favor" industries/niche areas like...hot tub companies and direct mail marketing businesses. Can't tell if they target 'out of favor' plays or are just straight up out of touch.
Direct mail isnt out of touch. Still a huge channel lol
For color, it costs ~50 cents to get a color catalog into someone's mailbox.
It costs $1+ for a digital click on FB :)
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Stellex don't really do distressed anymore
Historically, Black Diamond Capital Management played here and had some strong returns in the first couple of funds but sized down. I think they do mostly buyout auctions now.
Any info on who the biggest distress / special sits PE firms are outside of Apollo / Ares ASOF / Cerberus / Oaktree ?
Platinum / Brookfield / KPS
One rock huge value guys
any info on Atlas Holdings?
Gamut, Staple Street (dominion might be the GOAT return lmao), One Rock
Stifel deal heh heh
Whoever threw monkey shit: it literally was
I think Aterian as well
A few MM and LMM names, skewing towards the smaller firms:
(Note ~ I wouldn't bucket these firms in with the super distressed guys i.e., taking a business on life support and making it stable - I'd think about them like taking below average/okay businesses and making them good - think, 3-6x EBITDA to 7-10x.)
- Pacific Avenue ~ newer firm with an exceptional pre-fund track record (>7x and astronomical IRR). The founder is a visionary and is trying to build something very big. They recently raised Fund I - can't remember the size exactly but they had well upwards of $1 billion in demand - however, I believe they capped it below that. I anticipate Fund II being $1.5 billion+. They are out of LA - I'd consider them the most value-oriented of the bunch on this list. They specialize in corporate carveouts.
- LFM ~ out of Nashville, very similar to Middleground. Don't know them well, but heard they are very strong. They never have to fundraise - the best LPs in the country all want an allocation.
- Core Industrial Partners ~ These guys specialize in industrial automation i.e., Industry 4.0, so they may be the least value-oriented of this bunch, but they are exceptionally good. With that said, I've heard they are looking to beef up their ops team and add more folks focused on business stability, which could be a very useful place for your skills.
- Warren Equity Partners ~ Focused on infrastructure service businesses like power plant maintenance, waste management, and utility vegetation management. They are growing very fast and will soon be above $10 billion in AUM if they aren't already.
A few other groups worth exploring: Dunes Point, Architect Equity, Angeles, Tenex, Crossplane, Liberty Hall, Gallant, Greenbriar, and OpenGate.
If you are really interested in MM/LMM distressed shops, there are numerous Gores and Platinum spin-outs that fit this mold, some of which I've listed.
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