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MidOcean Partners has acquired Cloyes, a leader in timing drive systems, from Hidden Harbor Capital Partners. This marks MidOcean's third investment in the automotive aftermarket within 15 months, following investments in FullSpeed Automotive and Holley Inc. Cloyes, founded in 1921, serves over 300 customers with over 2,700 SKUs, emphasizing high-performance applications. The acquisition aims to accelerate growth and innovation, with leadership experienced in the automotive sector joining Cloyes' board. Financial terms were not disclosed.
Positive
Acquisition aligns with MidOcean's strategy to expand in the automotive aftermarket.
Cloyes has strong market presence with over 300 customers and 2,700 SKUs.
NEW YORK--(BUSINESS WIRE)--
MidOcean Partners, a premier middle market private equity firm focused on the business services and consumer sectors, announced today that it has acquired Cloyes (“Cloyes” or the “Company”) from Hidden Harbor Capital Partners. Cloyes is a North American leader and global designer, developer, manufacturer and distributor of timing drive systems and engine components for original equipment manufacturers and the automotive aftermarket, selling its products under the Cloyes® brand throughout North America and Dynagear® in Mexico. MidOcean Partners plans to continue the Company’s aggressive growth plan through comprehensive organic initiatives and strategic M&A. Financial terms of the transaction were not disclosed. This transaction represents MidOcean’s third recent investment in the auto aftermarket industry after completing investments in FullSpeed Automotive, a leading auto aftermarket services platform with over 700 locations purchased in November 2020, and Holley Inc. (NYSE: HLLY), a leading designer, marketer, and manufacturer of high-performance automotive aftermarket products for car and truck enthusiasts, through its merger in July 2021 with Empower Ltd. a publicly traded special purpose acquisition company formed by MidOcean Partners.
Cloyes was founded in 1921 and has built a reputation among engine builders and technicians of quality and best-in-class VIO (“vehicle in operation”) coverage, providing its 300+ customers with access to over 2,700 SKUs. The Company’s products are mission critical components for engine performance and function used in high-performance and replacement applications. Cloyes serves a broad customer base, including wholesale distributors, national and local retailers, re-packagers, and production engine builders.
Daniel Penn, Managing Director at MidOcean, commented, “MidOcean’s investment in Cloyes marks the third investment in the automotive aftermarket space in the last 15-months. We continue to see significant tailwinds in the auto aftermarket space, and are thrilled to bring Cloyes into the portfolio of best-in-class auto aftermarket products and services MidOcean has invested behind. Our focus in this sector has been in partnership with our MidOcean Operating Partner, Marc Graham, who brings over 35 years of experience in this industry, and we are pleased to have Marc involved as the Chairman of the Board going forward. We are also thrilled that Linda Taliaferro will be joining the Company’s Board, as her over 35 years of experience in quality and global supply chain in the automotive industry will be a tremendous asset to Cloyes.”
Steven Loeffler, Principal at MidOcean, commented, “We couldn’t be more excited to partner with CEO John Hanighen and the Cloyes team, who are proven leaders in the automotive aftermarket space. The team at Cloyes has done an amazing job building its VIO coverage, continuing to develop new products and winning new customers. We believe there are numerous opportunities through both organic initiatives and accretive strategic acquisitions to continue this growth.”
Marc Graham, MidOcean’s Operating Partner, commented, “The Cloyes brand has been synonymous with excellence in timing systems for over 100 years, and we are thrilled to continue that leadership going forward. Cloyes has a best-in-class product suite, complemented by world-class product development capabilities. On a personal note, I have known John for over 35 years and am excited to work with John and his tremendous team.”
“We are excited to partner with MidOcean to accelerate growth and innovation for the Cloyes platform,” said John Hanighen, CEO of Cloyes. “MidOcean has an impressive track record in executing transformational growth, and they bring deep expertise in the auto aftermarket that will enhance our ability to better serve our customers, our employees, our vendors, and our partners, while also providing support for the Company to expand into additional markets and product lines.”
Gibson Dunn & Crutcher LLP acted as legal advisor to MidOcean. Stifel, Nicolaus & Company, Inc. served as lead financial advisor with Donnelly Penman & Partners as co- advisor and McDermott Will & Emery LLP as legal advisor to Cloyes.
About Cloyes
Cloyes is the North American leader and global designer, developer, manufacturer and distributor of timing drive systems and components for the automotive aftermarket. Its products are mission critical components for engine performance and function and are used in high-performance and replacement applications. Cloyes serves a broad customer base, including wholesale distributors, national and local retailers, re-packagers, and production engine builders, and sells its products under the Cloyes® brand throughout North America and Dynagear® in Mexico. Cloyes is headquartered in Fort Smith, Arkansas. For more information, please visit www.cloyes.com
About MidOcean Partners
MidOcean Partners is a premier New York-based alternative asset manager specializing in middle-market private equity and alternative credit investments. Since its inception in 2003, MidOcean Private Equity has targeted investments in high-quality middle-market companies in the consumer and business services sectors. MidOcean Credit was launched in 2009 and currently manages a series of alternative credit strategies, collateralized loan obligations (CLOs), and customized separately managed accounts.
