KPS Capital Partners has agreed to acquire AM General, a military vehicle and contract automotive manufacturer, from MacAndrews & Forbes, an investment firm controlled by Ronald Perelman.
AM General manufactures specialized vehicles for military and commercial customers including the iconic High Mobility Multipurpose Wheeled Vehicle (HUMVEE). The company’s military products include light tactical vehicles and troop carriers. AM General also operates two wholly-owned subsidiaries, General Engine Products, a diesel engine manufacturer, and General Transmission Products, an automatic transmission manufacturer.
AM General, led by CEO Andy Hove, is headquartered in South Bend, Indiana with manufacturing facilities located in Indiana and Ohio, and a technical engineering center in Michigan.
“KPS, with a decades-long track record of building world-class, industry-leading companies, is the ideal partner for AM General and the military and commercial customers we serve,” said Mr. Hove. “We look forward to working with KPS to continue to execute our strategy and invest in our ambitious growth plan. KPS’ demonstrated commitment to manufacturing excellence, continuous improvement and commitment to invest in technology and innovation will only enhance the company’s ability to compete in today’s military and commercial marketplace.”
AM General traces its roots to the Standard Wheel Company which was founded in 1903 in Terre Haute, Indiana. In 1908, John Willys purchased the business and renamed it Willys-Overland Motors. During the 1940’s, Willys-Overland developed a four-wheel drive tactical utility truck for the US Army – the “Jeep” of World War II fame.
In 1953, Kaiser Motors purchased Willys-Overland, changing its name to Kaiser-Jeep Corporation in 1963. American Motors purchased the company in 1970 and operated the business through its General Products Division and in 1971 spun out the division as AM General Corporation, a wholly-owned subsidiary that produced military trucks and non-commercial vehicles. LTV acquired AM General in 1983 and sold it to Renco Group (a holding company controlled by Ira Rennert) in 1992. In 2004, Ronald Perelman’s MacAndrews & Forbes acquired the company from Renco.
“We are excited to acquire AM General, a legendary American company and world leader in the design, engineering, manufacturing and support of light tactical and specialty vehicles,” said Jay Bernstein, a partner of KPS. “We look forward to working with CEO Andy Hove, the company’s management team, and all of AM General’s employees to build on this great platform, organically and through acquisition.”
Since its founding more than 100 years ago, AM General has built and maintained over one million vehicles and more than 300,000 automotive systems. Today, AM General builds more military light tactical vehicles than any other company in the world.
“We intend to leverage the company’s commitment to research, technology, innovation and new product development, as well as its heritage and iconic brand name,” added Mr. Bernstein. “KPS’ demonstrated track record and history of successfully investing in specialty vehicle businesses – as well as its global platform and significant financial resources – make us exceedingly confident that AM General will continue to thrive under KPS’ ownership for the benefit of its customers and all stakeholders.”
KPS Capital Partners makes control investments in manufacturing and industrial companies across a range of industries, including basic materials, branded consumer, healthcare, automotive parts, capital equipment, and general manufacturing. Many of KPS’s investments involve creating new companies to buy underperforming or distressed assets, companies operating in bankruptcy or in default of obligations to creditors, or with a history of recurring operating losses. KPS is headquartered in New York City with additional offices in Frankfurt and Amsterdam.
In October 2019, after just four weeks of fundraising, KPS held a first, final, hard cap and oversubscribed closing of KPS Special Situations Fund V LP and KPS Mid-Cap Fund LP. KPS Fund V had a $5 billion target and a $6 billion hard cap, and KPS Mid-Cap had a $750 million target and a $1 billion hard cap. In June 2020, KPS acquired the Lufkin rod lift business from publicly traded Baker Hughes. Lufkin’s rod lift products, technologies, and services are used in the energy sector to pump oil and gas to the surface using artificial pressure.
MacAndrews & Forbes, the seller of AM General, is a New York City-based holding company controlled by billionaire investor Ronald Perelman. The firm has a portfolio of companies across a range of industries from cosmetics and entertainment to biotechnology and military equipment.
Closing of the buy of AM General by KPS is expected in the third or fourth quarter of 2020.
Private Equity Professional | July 24, 2020
Cryptocurrency Cards: An Unnecessary Solution That Should Be Stopped
It is high time for traditional financial institutions to see that the crypto industry has matured enough and does not possess high risks.
This Week in Fintech ending 7th August 2020
This weekly summary from our 8 experts, brings you insights based on their experience as investors, entrepreneurs & executives.
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The initial Ethereum team consisted of Vitalik Buterin, Anthony Di Iorio, Bitcoin Magazine co-founder Mihai Alisie, Amir Chetrit and Charles Hoskinson. The team printed black Ethereum t-shirts and started working on the Ethereum Blockchain in 2013. Later, they added three more co-founders Joseph Lubin, Gavin Wood, and Jeff Wilcke. They didn’t know each other very well or have a detail plan of what they would finally create. But they had a vision. They wanted to create a “world computer” that would transform not just money, but allow anyone to write smart contracts, decentralized applications and create their own arbitrary rules for asset ownership. Ethereum went live on 30 July 2015, with 72 million coins minted. That was five years ago. Today, stablecoins and DeFi, have turned Ethererum into the most used blockchain.
Editor note: Ilias makes a persuasive explanation of why Ethereum is doing well, citing traction in the key new markets of the future – stablecoins and DeFi.
Tuesday Efi Pylarinou @efipm our Swiss-based Fintech Adviser, founder of Efi Pylarinou Advisory and a Fintech/Blockchain influencer – No.3 influencer in the finance sector by Refinitiv Global Social Media 2019 wrote A selection of 7 themes on ETFs and robo-advisors
A mini digital detox in August, may reboot and upgrade my operating system. In this post, I am sharing a selection from this year`s posts focused on ETFs (a 50yrs old innovation) and robo-advisors.
2020 started with a healthy and growing $5trillion global ETF market. In the US there were 2,000 already trading on platforms with zero commissions.
Editor note: the trend towards low cost, mostly passive, investment vehicles stays very strong even if we are now past the Cambrian explosion era and into a consolidation phase when a few big winners emerge.
Alan Scott Managing Director EMEA at 24 Exchange @Alan_SmartMoney wrote Stablecoin News for the week ending Tuesday 4th August
This weekly snapshot is the news that matters in the Stablecoin market.
Wednesday Guest author Amber Sutherland wrote A bankers guide to AI Part 2. What if the AI learns the wrong behaviours, such as bias?
Editor note: In every industry, banking included, much money will be made from AI automation (and sadly, many jobs lost). This 5 parter gives you some of the nuances and complexity of making that happen in banking.
Thursday Patrick Kelahan @insuranceeleph1, our US based Insurtech expert (a CX, engineering & insurance professional, working with Insurers, Attorneys & Owners who also serves the insurance and Fintech world as the ‘Insurance Elephant’) wrote Become a captive and be freed- an alternative to traditional risk management
Knowing there are risks that are challenging to underwrite or expensive to share with a carrier does not have to limit a firm’s or groups options for risk management, nor does a prospective firm need to engage a top-heavy syndicate where 40% of premium dollars result in expense costs. For those firms with stout hearts, clever advisers and an urge to have closer management of risk there are captive insurance schemes. And there just might be tax savings, too.
Editor note: Required reading fornsurance companies figuring out how to add value to corporates who do insurance in-house.
Thursday Christian Dreyer @x3er, our Swiss based CFA who focusses on how XBRL changes our world wrote XBRL: real-time reporting, extensible lists and rulesets
Editor note: This weekly snapshot is the news that matters in the XBRL market.
Editor note: This weekly snapshot is the news that matters in the Alt Lending market.
Bernard Lunn @lunnbernard, the CEO of Daily Fintech and author of The Blockchain Economy, wrote:Interview with John O’Neill of Silent Eight on how to use AI in financial services
Editor note: Read this to learn about AI for detecting money laundering, accounting fraud and consumer scams
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Cambodia payments fintech Clik lands $3.7m
Clik, a Cambodia-based fintech delivering mobile payment solutions to enterprises, merchants and consumers, has landed $3.7 million funding.
It marks the largest ever seed round in Southeast Asia to date, according to Crunchbase.
The round was led by strategic investors Openway – a Belgian digital payment software – and POEMS, a Singapore-based online trading platform. The funding also includes $2 million of commitments announced at the end of 2018.
Funding and partner network
Click intends to use the new capital to flesh out its product engineering and customer service teams.
Yet to formerly launch, the capital will also underpin its launch in Cambodia sometime later this year.
Since its founding in 2016, Clik has focused on building its partner network. It now has around 2,500 merchants on its books, alongside five financial institutions. These partnerships provide it with access to more than 56,000 merchants across Cambodia.
Some of its heavyweight partners include Ucare Pharmacy, Kiwimart and conglomerate Chip Mong Retail.
“After two years of scaling up and defining the fundamentals of our regional market strategy, we’re ready to accelerate our growth with the closure of our seed round,” says CEO and co-founder Matthew Tippetts.
The CEO thinks the round proves “investors are eager to back future proof platforms for the ‘new normal’ that will inevitably exist post-covid”.
He also thinks it nods to the attractive opportunities for investment in Cambodia, “especially in start-ups with robust regional potential”.
What does Clik do?
The start-up claims to be the first Southeast Asian provider of PCI-certified mobile point of sale (PoS) and software PoS merchant acquiring payment solutions.
The fintech is currently developing a platform which helps merchants build consumer loyalty and boost profits.
Having developed its own Know Your Customer (KYC) solution, Clik claims it can onboard consumers and merchants “in minutes”.
The new capital arrives as Clik announces a series new hires. They include its chief operating officer, Patrice Vignes, who previous served as chief financial officer of Amret, a Cambodia-based micro-finance provider.
Olivier Mermet is also welcomed into the fold. Having worked at Procter & Gamble for more than seven year, Mermet will now serve as Clik’s chief design and strategy officer.
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