The Tekkote Division of Jen-Coat, Inc. produces release liner on paper, film and coated paper for use in a wide variety of industrial and consumer end markets. Jen-Coat originally acquired Tekkote in 1999.
Brookwood advised Jen-Coat, Inc and its private equity investor CGW Southeast Partners on the divestiture of the Tekkote division. Tekkote was acquired by management with backing from Shaker Investment Partners, a Cleveland based private equity firm.
Engagement Process and Outcomes
Management and Shareholder Goals – Jen-Coat acquired Tekkote hoping to realize operating synergies and volume based purchasing discounts. A shift in the release liner industry post acquisition led to less overlap in purchasing between Tekkote and its parent. Management and CGW jointly decided a divestiture of Tekkote would improve Jen-Coat’s focus on its core businesses.
Effective Marketing – Private equity interest in the business was tempered due to the size of the business and a history of earnings volatility. Brookwood contacted the most logical strategic buyers to gauge their interest in acquiring Tekkote. After receiving offers from strategic buyers, Jen-Coat and CGW entertained and accepted an offer from Tekkote management with backing from Shaker Partners.
Excellent Result – The strategic marketing process allowed the shareholders to quickly gauge the interest level for Tekkote. Ultimately, Tekkote management offered an attractive price and a quick timeline to close.