Posted on February 6, 2023
Funds managed by global investment firm Carlyle (NASDAQ: CG) and private equity firm Stellex Capital Management today announced a definitive agreement to sell Titan Acquisition Holdings, a bi-coastal leader in ship repair services and marine and heavy complex fabrication, to an affiliate of Lone Star Funds.
The transaction is expected to close in 2023 upon satisfaction of customary closing conditions, including certain governmental approvals. Financial terms were not disclosed.
Titan is comprised of Vigor Industrial LLC, an infrastructure, defense, and maritime services company based in Portland, Oregon; MHI Holdings LLC, a ship repair, maintenance, and other ship husbandry services company based in Norfolk, Virginia; and Continental Maritime of San Diego (CMSD). Key Titan customers include the U.S. Navy, U.S. Coast Guard, Military Sealift Command, Boeing, cruise lines, fishing fleets, barges, ferry services for local and state governments, and other key commercial U.S. Government customers.
Derek Whang, Managing Director at Carlyle, said: “We are proud of the many accomplishments of the Titan team over the course of our partnership. Throughout a particularly unprecedented time, with the pandemic and supply chain constraints, the Titan team has continually executed on its strategy to successfully grow the business, refine its market segments, and expand into new geographic territories. Titan is well-positioned to maintain its positive trajectory, and we wish the team continued success in its next phase of growth.”
David Waxman, Managing Director, Stellex, said: “From the moment Stellex acquired MHI in 2015, we have partnered with management to capitalize on changing market dynamics to build a stronger company to further serve customers with quality and reliability. The result of our investment focus was the combination of MHI with Vigor and the formation in 2019 of Titan, now a bi-coastal leader in critical ship repair services, and commercial and defense-related fabrication services. It was an incredible experience working closely with the talented Titan team, and we look forward to seeing the company continue to prosper.”
Jim Marcotuli, Titan Chief Executive Officer, said: “We are grateful to Carlyle and Stellex for enabling the strategic investments made over the past several years, which include the acquisition of CMSD, the repurchase of critical assets, and investments in technologies and equipment aimed at improving our service offerings.”
Marcotuli continued: “Titan and its operating companies will remain rooted in existing values and focused on priorities of Safety, Compliance, Quality, Customer and Competitive. Under new ownership, we will focus on sustaining improvements made, identifying additional areas of improvement, and opportunities for future growth. Valued customers will continue to see Titan operating companies deliver high quality service in everything we do.
“We see this transaction with Lone Star, when completed, as the next step in our evolution, representing a belief on their part that Titan entities are on a steady and positive path to sustainable growth.”
Jim Marcotuli will continue in his current role as Titan CEO, and other company leadership is expected to remain intact.
Kirkland & Ellis LLP is serving as legal counsel and Lazard served as financial advisor to Lone Star. Latham & Watkins, LLP is serving as legal counsel to Titan, Carlyle, and Stellex, and BofA Securities and Evercore served as financial advisors.
About Lone Star
Lone Star, founded by John Grayken, is a leading private equity firm advising funds that invest globally in real estate, equity, credit, and other financial assets. Since the establishment of its first fund in 1995, Lone Star has organized 22 private equity funds with aggregate capital commitments totaling approximately $86 billion. The firm organizes its funds in three series: the Commercial Real Estate Fund series; the Opportunity Fund series; and the U.S. Residential Mortgage Fund series. Lone Star invests on behalf of its limited partners, which include institutional investors such as pension funds and sovereign wealth funds, as well as foundations and endowments that support medical research, higher education, and other philanthropic causes. For more information regarding Lone Star Funds, go to www.lonestarfunds.com.
About Carlyle
Carlyle (NASDAQ: CG) is a global investment firm with deep industry expertise that deploys private capital across three business segments: Global Private Equity, Global Credit and Global Investment Solutions. With $369 billion of assets under management as of September 30, 2022, Carlyle’s purpose is to invest wisely and create value on behalf of its investors, portfolio companies and the communities in which we live and invest. Carlyle employs more than 2,100 people in 29 offices across five continents.
Further information is available at www.carlyle.com. Follow Carlyle on Twitter @OneCarlyle.
About Stellex Capital Management
With offices in New York, Detroit, Pittsburgh, and London, Stellex is a private equity firm with over $2.6 billion in AUM. Stellex seeks to identify and deploy capital in opportunities that have the potential to provide stability, improvement, and growth. Portfolio companies benefit from Stellex’s industry knowledge, operating capabilities, network of senior executives, strategic insight, and access to capital. Sectors of particular focus include specialty manufacturing, industrial and business services, aerospace & defense, automotive, government services, transportation, logistics and food. Additional information may be found at www.stellexcapital.com.
About Titan Acquisition Holdings
A family of bicoastal leaders in ship repair, ship modernization, marine and complex fabrication services, Titan Acquisition Holdings was formed by global investment firm The Carlyle Group and private equity firm Stellex Capital Management following their 2019 acquisition of MHI Holdings and Vigor. Titan is the parent company of Vigor, operating in the Pacific Northwest, Hawaii and Alaska; MHI, based in Norfolk, Virginia; and Continental Maritime of San Diego (CMSD) in California. Notable Titan family customers include Boeing, Lockheed Martin, Northrop Grumman, U.S. Navy, Military Sealift Command, Maritime Administration, U.S. Army, local and state ferry systems, and commercial ship owners.
