FloWorks Completes Financing

Rhea-AI Summary

FloWorks International, a specialty distributor of critical flow control products and portfolio company of Wynnchurch Capital, has completed a refinancing transaction. Oak Hill Advisors (OHA), the private markets platform of T. Rowe Price Group (NASDAQ:TROW), served as Administrative Agent and Lead Left Arranger for the private unitranche facility. The financing will be used to refinance FloWorks's existing debt and support future acquisitions. OHA is the largest holder across the new financing facility, citing their familiarity with the specialty distribution industry as a key factor in their investment decision.

Positive

• Secured new financing to support future acquisitions
• Partnership with major financial institution (T. Rowe Price's OHA)
• Successfully refinanced existing debt

Negative

• None.

Insights

Financial Analyst

The refinancing of FloWorks, facilitated by T. Rowe Price's Oak Hill Advisors platform, represents a significant development in the private credit space. The unitranche facility demonstrates OHA's confidence in FloWorks's business model and growth potential. For $27.3B market cap T. Rowe Price, this deal through its OHA platform showcases its strategic expansion in private markets and alternative investments - a important diversification from traditional asset management. The transaction strengthens TROW's position in private credit markets while potentially generating steady fee income. The deal's structure as a unitranche facility typically offers simplified terms and potentially higher yields compared to traditional syndicated loans, which could benefit TROW's revenue streams.

Market Research Analyst

This refinancing deal highlights the growing importance of private credit markets and alternative investment platforms for traditional asset managers like T. Rowe Price. The specialty distribution sector, where FloWorks operates, has shown resilience and growth potential, particularly in MRO (Maintenance, Repair and Operations) applications. OHA's position as both Administrative Agent and Lead Left Arranger indicates significant commitment to the deal. For TROW shareholders, this represents positive diversification of revenue streams beyond traditional asset management, particularly important in the current market environment where alternative investments are gaining prominence. The deal also positions TROW to capture more opportunities in the middle-market lending space.

ROSEMONT, Ill.--(BUSINESS WIRE)-- FloWorks International LLC (“FloWorks”), a leading specialty distributor of critical flow control products and provider of tailored technical solutions for MRO-focused applications and a portfolio company of Wynnchurch Capital, L.P. (“Wynnchurch”), has successfully completed a refinancing.

Oak Hill Advisors (“OHA”), the private markets platform of T. Rowe Price Group, Inc. (NASDAQ:TROW), served as Administrative Agent and Lead Left Arranger for the private unitranche facility. OHA is the largest holder across the new financing facility, which will be used to refinance the company’s existing debt and support future acquisitions.

Greg Gleason, Managing Partner at Wynnchurch, stated, ​“We are excited to be partnering with OHA on this important financing for FloWorks and believe they will be a strong partner in supporting FloWorks’s continued, accelerated growth.” Steve Yan, Head of Debt Capital Markets at Wynnchurch, added, ​“This marks the first financing transaction between OHA and Wynnchurch. We look forward to continuing to build on our relationship with OHA as we continue to invest in scaled, high quality businesses.”

“Our familiarity with the specialty distribution industry through our investments in similar companies allowed us to quickly gain conviction in FloWorks and its business model,” said Eric Muller, Partner and Portfolio Manager at OHA. “The company has successfully scaled while building a strong track record through its customized platform, and we look forward to contributing to FloWorks’s next stages of growth.”

Kirkland & Ellis LLP served as financing counsel to FloWorks in connection with the transaction.

About FloWorks:

Headquartered in Houston, Texas, FloWorks is a leading specialty distributor of critical flow control products and provider of tailored technical solutions for MRO-focused applications. The Company serves customers across chemicals, downstream refining & renewables, high purity & sanitary, and other industrial end markets. FloWorks’ product categories include valves & automation, corrosion resistant flow control, rotating equipment, flanges, filters & purifiers, and instrumentation.

About Wynnchurch Capital:

Wynnchurch Capital, L.P., headquartered in the Chicago suburb of Rosemont, Illinois, with an affiliate in Canada, was founded in 1999 and is a leading middle-market private equity investment firm. Wynnchurch’s strategy is to partner with middle market companies in the United States and Canada that possess the potential for substantial growth and profit improvement. Wynnchurch manages a number of private equity funds with $9.2 billion of regulatory assets under management and specializes in recapitalizations, growth capital, management buyouts, corporate carve-outs, and restructurings. Recently, Wynnchurch acquired Principal Industries, a leading provider of LED components and engineered assemblies. Other recent investments include: ORS Nasco, North America’s largest pure wholesaler of industrial MRO supplies; Hydraulic Technologies, a market leader in high-pressure hydraulic tools; and Reagent, the #1 specialty distributor of hydrochloric acid in North America. For more information, please visit: http://​www​.wyn​nchurch​.com or follow us on LinkedIn.

About OHA:

Oak Hill Advisors (OHA) is a leading global credit-focused alternative asset manager with over 30 years of investment experience. OHA works with institutions and individuals and seeks to deliver a consistent track record of attractive risk-adjusted returns. The firm manages approximately $71 billion of capital across credit strategies, including private credit, high yield bonds, leveraged loans, stressed and distressed debt and collateralized loan obligations as of September 30, 2024. OHA’s emphasis on long-term partnerships with companies, sponsors and other partners provides access to a proprietary opportunity set, allowing for customized credit solutions across market cycles. With over 400 experienced professionals across six global offices, OHA brings a collaborative approach to offering investors a single platform to meet their diverse credit needs. OHA is the private markets platform of T. Rowe Price Group, Inc. (NASDAQ – GS: TROW). For more information, please visit oakhilladvisors.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20241211110014/en/

For new investment opportunities, please contact:

Mike Teplitsky

Partner

mteplitsky@wynnchurch.com

Scott Fitch

Partner

sfitch@wynnchurch.com

Source: Wynnchurch Capital, L.P.

FAQ

What is the purpose of FloWorks' new financing through T. Rowe Price's OHA (TROW)?

The new financing will be used to refinance FloWorks' existing debt and support future acquisitions.

What role does T. Rowe Price (TROW) play in FloWorks' refinancing deal?

Oak Hill Advisors (OHA), T. Rowe Price's private markets platform, serves as Administrative Agent and Lead Left Arranger for the private unitranche facility.

Why did OHA (TROW) choose to finance FloWorks?

OHA cited their familiarity with the specialty distribution industry through investments in similar companies, and their conviction in FloWorks' business model and track record.

How will the TROW-backed financing impact FloWorks' growth strategy?

The financing is expected to support FloWorks' continued, accelerated growth through future acquisitions and debt refinancing.