Author: Stephanie Fine

Prophet Equity, in partnership with Terra Manna, is preparing to break ground on the first phase of Silo Mills, an 840-acre master-planned community in Johnson County. Located on Farm-to-Market Road 917 and west of the Chisolm Trail Parkway, the residential development will provide affordable quality housing within the extraterritorial jurisdiction of Cleburne and Burleson.

The development groundbreaking will be held at 10 a.m. Nov. 3 and will host a mix of municipal, school district, investment and development executives.

“Three decades ago, the Dallas North Tollway began linking the northern suburbs of Frisco, Plano and Prosper with Dallas,” explained Bobby Harrell with Southlake, Texas-based Terra Manna. He explained that the Chisolm Trail Parkway, which officially opened in 2015, will have a similar impact, as it connects Fort Worth directly to Cleburne and other southwest metroplex cities.

“We’re already seeing growth along the Chisolm Trail corridor,” he added. “As such, Silo Mills is uniquely positioned to capture expanding residential demand for the area.”

Upon buildout, Silo Mills will offer 2,500 home sites. The first phase will consist of 262 sites of 50-, 60- and 70-foot lots. Antares Homes and Bloomfield Homes are the designated home builders. Model homes are anticipated for a spring 2022 opening. Prices will start in the high $200,000s.

Along with quality-built homes, Silo Mills will provide a variety of resident amenities, including a resort-style swimming and entertainment complex, parks and playgrounds, trails, stocked water features and plenty of preserved green space. Families will be served educationally by the Godley ISD, with a new elementary school opening within the community during 2022.

“Silo Mills represents one of the first master-planned communities to be developed on the length of Chisolm Trail Parkway, that’s well south of the Tarrant County-Johnson County line,” said Ted Wilson, principal of Dallas-based Residential Strategies, Inc. and a leading new homes industry analyst. “New home construction activity has more than tripled in this area over the past four years with over 300 annual starts taking place.”

In addition to being ideally located to the Fort Worth employment centers, Silo Mills will also be situated close to Cleburne, which is fast becoming an important employment center. Residents will also be within commuting distance of shopping, dining, medical and educational establishments.

“This is a perfect time to be working on a development of this type,” said Bret Pedigo with Terra Manna. “This part of the metroplex is experiencing a great deal of housing demand, and Silo Mills will deliver an exceptional quality community with affordable homes. We’re delighted to be part of this project.”

Featured in the Cleburne Times Review on October 25, 2021

March 23, 2021 – Southlake, TX – Prophet Equity (“Prophet”), a Southlake, TX-based private equity firm, completed the sale of its portfolio company, Ace Asphalt of Arizona, Inc., (“Ace” or the “Company”) to Sunland Asphalt & Construction, LLC, a portfolio company of Huron Capital.

In December 2010, Prophet acquired Ace from Tim Drexler, whose father founded the business in 1966. The Company which is headquartered in Phoenix, AZ has been able to grow both revenue and EBITDA through deploying their best-in-class operational approach into core and expansion markets. Ace’s unique set of strategic capabilities allowed the Company to expand its core markets revenue by ~41% and Greenfield four new growth markets. In recent years, Ace has amplified its focus on recurring maintenance by growing its public works maintenance business and expanding its recurring services offerings to ~70% of total revenue.

“Ace’s transformation is a testament to the hard work and determination of the management team and employees,” said David Rex, General Counsel at Prophet Equity “Because of their commitment and partnership Ace is ideally positioned to capitalize on enormous opportunities in the US Southwest.”

Michael Hirschfeld, Principal at Prophet Equity commented, “While Ace has always been a very strategic business, it has been incredible to work alongside Scott Phillips and the entire senior leadership team to drive an industry leading culture and strong bottom line performance, particularly over the past three years. Through leveraging our collective strengths the business and leadership team have driven EBITDA up 3.57x or ~257%.

“The Prophet Equity team has been the ideal partner for Ace and the leadership team,” said Scott Phillips. “We are thankful for the collaborative assistance Prophet Equity has provided to enable us to create such a unique business.”

“Ace is another example of our unique ability to dramatically improve performance through our Fortune 500 and private equity proven strategic and operational implementation toolkit and hands on approach,” added Ross Gatlin, Prophet’s Managing Partner. “Our uniquely collaborative approach, combined with the deployment of our Holistic Value Creation™ (HVC™) process is a testament to the opportunity that can be unlocked in businesses like Ace. We thank the exceptionally experienced management team at Ace for their commitment and dedication to maximizing value.”

TM Capital served as financial advisor and Jackson Walker as legal counsel to Ace and Prophet Equity.

January 27, 2021 – Southlake, TX – On December 18, 2020, Prophet Equity (“Prophet”), a Southlake, TX-based private equity firm, completed the sale of Total Plastics International (“Total Plastics” or the “Company”) to the privately held Plastics Family, which comprises many market leading plastic distributors around the world.

In March 2016, Prophet acquired Total Plastics from A.M. Castle & Co. (NYSE: CAS), partnering with the Company’s President, Tom Garrett, and long-time industry veteran team. Since that time, Total Plastics successfully acquired and integrated two additional facilities, expanded and refined the distribution and value-add capabilities of its unique hub-and-spoke model, divested select non-core operations, and grew core sales and EBITDA approximately 36% and 194%, respectively.

Charlie Velie, Senior Associate at Prophet Equity said, “Total Plastics commitment, focus and dedication enabled the Company to outperform in a highly competitive market. The unique and efficient redesign of their operating model facilitated sustainable and profitable growth, transforming the Company into a clear leader in the industry.”

“It has been an honor working with the Total Plastics management team,” said Charles Collie, Managing Director at Prophet Equity. “I am particularly proud of the Company’s work and responsiveness to the COVID-19 pandemic, producing over 5 million face shields and other personal protective equipment in support of healthcare workers and other first responders.”

Ross Gatlin, Managing Partner of Prophet Equity said, “The deployment and execution of our Holistic Value Creation™ (HVC™) process at Total Plastics translated into a highly successful outcome for all investors and stakeholders. It has been a pleasure working alongside such a talented team at Total Plastics, and we wish them and the Company the best in their next phase of growth under the ownership of the Plastics Family.”

William Blair served as exclusive financial advisor and Jackson Walker as legal counsel to Total Plastics and Prophet Equity.

Founded in 1977 and headquartered in Louisville, KY, Derby Fabricating Solutions is a leading manufacturer of die cut nonmetallic materials for automotive Noise Vibration & Harshness (NVH) and Buzz Squeak & Rattle (BSR) reduction applications. In the midst of the COVID-19 pandemic, the team has expanded its manufacturing offerings to include mission-critical, face shields designed for frontline essential workers. Operating facilities in KY, OH, TN, and MI, the Derby team is available to provide face shield manufacturing throughout the U.S. For further inquiries regarding Derby’s face shield capabilities please visit: www.derbyfab.com.

Prophet’s CEO & Managing Partner, Ross Gatlin commented, “Derby Fabricating Solutions nimble redirection of their proven manufacturing capabilities to service urgent medical needs and battle the pandemic is nothing short of amazing.  Not only did they pivot aggressively to support the medical industry and essential services everywhere, but they utilized their world class engineering talent  to also adapt conventional face shields to hard hats in order to help keep those in industrial businesses safe while they are hard at work.”  Jason Kellams, President of Derby, also stated  “Our team of dedicated and experienced professionals across the value chain of engineering, product development, quality control, manufacturing, sales, distribution and service continue to serve not only our long term automotive customers, but also essential service providers everywhere during these turbulent times.”

ABOUT PROPHET EQUITY

Prophet Equity is a private equity firm that uses proven, data-driven analytical techniques coupled with over 100 years of investment and management experience to invest in, unlock and realize future value today. Partnering with owners and management teams, Prophet Equity’s team utilizes a toolkit that is Fortune 500 tested and private equity proven to diagnose and drive dramatic value creation. Portfolio company management teams are highly motivated with clear, uncapped incentives based on realized business performance.

Over the last 20 plus years, Prophet Equity’s Principals have invested in and managed over $2.5 billion of value creation across entities with over $6 billion in revenue. Prophet Equity’s equity investments focus on strategically strong, lower and middle market businesses with significant value creation potential. These are typically found in partnerships, corporate carve-outs, divestitures and non-strategic business units of larger companies. For more information, please visit www.prophetequity.com or call us at +1.817.898.1500.

 

Prophet Equity’s core focus on investing only in platform companies with strong strategic viability has helped create a uniquely resilient and highly collateralized portfolio of Essential and Critical Service Businesses, which continue to show considerable strength, even in the face of the pandemic.

This week, we highlight another of our Essential Service providers, Groff Tractor & Equipment, a multi-state and product Heavy Equipment Dealer Network to the Infrastructure, Agricultural and Environmental space and how they have continued to move mountains for their essential and critical service customers during the fight against COVID-19.

Founded in 1958 and headquartered in Mechanicsburg, PA, Groff Tractor & Equipment is a heavy equipment dealer that provides essential sales and rental equipment, parts and services for infrastructure and recycling end markets.  Groff has 15 locations serving the mid-Atlantic region (Pennsylvania, Maryland, New Jersey, Delaware and Virginia).  Groff is a top 5 CASE dealer in North America and the leading Case dealer in the Northeast and the company also has excellent OEM partnerships with Wirtgen America, Roadtec, Terramac, Rubble Master, Liebherr, Terex, Takeuchi and other leading manufacturers.  Visit Groff Tractor & Equipment at www.grofftractor.com.

Prophet’s CEO & Managing Partner, Ross Gatlin commented, “Groff Tractor & Equipment is an essential business to the infrastructure in America.  We are proud to have invested behind a company that is an Essential Service business who has the team, capabilities, services and equipment to move mountains for its customers in any environment.”  Mike Savastio, President of Groff Tractor, also stated  “Our team of dedicated professionals, sales, service, product and rental equipment teams continue to serve and stand ready to assist with all of their needs during these turbulent times.”

ABOUT PROPHET EQUITY

Prophet Equity is a private equity firm that uses proven, data-driven analytical techniques coupled with over 100 years of investment and management experience to invest in, unlock and realize future value today. Partnering with owners and management teams, Prophet Equity’s team utilizes a toolkit that is Fortune 500 tested and private equity proven to diagnose and drive dramatic value creation. Portfolio company management teams are highly motivated with clear, uncapped incentives based on realized business performance.

Over the last 20 plus years, Prophet Equity’s Principals have invested in and managed over $2.5 billion of value creation across entities with over $6 billion in revenue. Prophet Equity’s equity investments focus on strategically strong, lower and middle market businesses with significant value creation potential. These are typically found in partnerships, corporate carve-outs, divestitures and non-strategic business units of larger companies. For more information, please visit www.prophetequity.com or call us at +1.817.898.1500.

Southlake, TX- Prophet Equity (“Prophet”) announces today that Donna Raine has expanded her role, joining the firm as Principal. “Having worked with Donna over the past several years, most recently as Chief Financial Officer of Allegiance Crane & Equipment, which was successfully sold in November of 2019, we have all been impressed with her ability to effectively work with teams and deliver tremendous results. I am thrilled we have the opportunity to continue our successful work together at Prophet and drive even more value creation across our stable of strategically viable platforms and continuing acquisitions”, commented Ross Gatlin, Managing Partner of Prophet.

Donna Raine joins us in this new capacity after her multi-year role successfully delivering tremendous results with our team as both a Chief Restructuring Officer and CFO of Allegiance Crane & Equipment. Ms. Raine brings decades of financial and operational expertise for lower and middle market companies across multiple industries. Donna’s operational and turnaround leadership experience across several privately held companies includes Healthcare Laundry Systems and Airwalk International, as well as, public accounting and appointment as Accountant to U.S. Bankruptcy Trustees. According to Ross Gatlin, “Donna’s unique combination of experience with our portfolio and team, and as a results driven operator of lower and middle market companies, in addition her turnaround background makes her a perfect and proven fit for our unique Holistic Value Creation™ (HVC™) and Prophet Full Potential Value™ (PFPV™) methodologies.”

Ms. Raine spoke about Prophet’s continuing focus on investing in strategically viable lower and middle market businesses and driving fundamental performance improvement as the first and foremost path to favorable returns for investors. “Having spent the majority of my career driving operational results while scaling businesses to enhance enterprise value in lower and middle market companies, Prophet Equity’s unique and solid approach to facilitate and accelerate fundamental value creation makes it a perfect partnership for me. Having recently worked with the team to deliver a very positive outcome, I am excited to continue my role with the existing portfolio, as well as new acquisitions.”

KALAMAZOO TOWNSHIP, Mich. (WOOD) — A West Michigan company has made more than 2 million face shields since the coronavirus pandemic began.

Total Plastics International says it can make between 50,000 to 60,000 each day at its plant just outside Kalamazoo.

According to Tom Garrett, president of the company, Total Plastics used to provide only the material and cut the plastic for face shields but saw the need to do more to get the protective equipment to front-line medical workers.

“When we first recognized the demand for the fully assembled shields, we partnered with a company to actually add the other components to make a fully functional assembled shield,” Garrett said.

The coronavirus pandemic has led to unprecedented demand at a rapid pace.

“Activity has been crazy the last two, three weeks. Orders with accounts we’ve never done business with, over 100 new customers,” Garrett said.

Total Plastics is also giving back to its West Michigan home base. The company was founded in Kalamazoo in 1978 and now owns 17 facilities in 10 states. It also has a plant in metro Grand Rapids that is producing face shields.

“One of the companies that we partnered with in Grand Rapids was Haworth and we made a donation to Spectrum Hospital of not just face shields but also some protective boxes for their patients,” Garrett said.

The manufacturer can even provide custom-built barriers for essential workers.

“Any place you normally have people very close to each other, everybody is looking for a way to be able to create some isolation and a protective barrier,” Garrett said.

The work is keeping the plant running while it helps medical professionals on the front lines.

“It has made it a lot easier for the folks to come to work knowing that they’re providing a critical need,” Garrett said.

He said his company has the capacity to increase production if needed.

https://www.woodtv.com/news/kzoo-and-bc/kalamazoo-company-cranks-out-face-shields-for-hospitals/

Prophet Equity’s Apex Environmental Resources Holdings II LLC Completed Five Add-On Acquisitions and Several High Value Strategic Initiatives, Increasing Daily Volumes 200%+ and Revenue 6X Since Acquisition

January 22, 2020 – Southlake, TX – Prophet Equity (“Prophet”), a Southlake, TX-based private equity firm, has completed the transformative merger of its portfolio company, Apex Environmental Resources Holdings II LLC (“Apex” or the “Company”), with The Action Environmental Group, Inc. (“Action”), majority owned by Summer Street Capital Partners, LLC. The merged Apex-Action company will conduct operations under the Interstate Waste Services (“IWS”) brand. Littlejohn & Co., LLC, a private investment firm based in Greenwich, CT led the equity financing to facilitate the transaction, while GSO Capital Partners, the credit investment arm of Blackstone, led the debt financing.

Prophet completed the initial Apex platform investment in October 2015, partnering with waste industry veterans Darren and Anthony Rizzo to purchase the Apex solid waste landfill in eastern Ohio and its local Apex transfer station. Under Prophet’s ownership, Apex successfully acquired and integrated three additional northern New Jersey transfer stations – Bridgewater Resources, Inc., Doremus Ave Recycling and Transfer, L.L.C., and Sajo Transport, Inc. – one northern New Jersey transload facility which operates a shortline railroad – New Jersey Rail Carrier Limited Liability Corporation, – as well as a western Pennsylvania-based transfer station, McKees Rocks Transfer Station LLC. During the four plus years of its majority ownership, Prophet and Apex management also expanded permitted landfill capacity approximately tenfold (10X), architected, designed and integrated a uniquely connected, point-to-point, proprietary rail transportation network, secured long-term contracts with leading New Jersey municipalities, while also bringing online a renewable landfill gas recovery and processing system producing a royalty-based cash flow stream effectively into perpetuity.

John Tatum, Managing Director at Prophet Equity commented, “We thoroughly enjoyed partnering with the Apex management team over the past four plus years. Apex’s dedicated focus on improving underlying profitability of the company’s waste volumes, coupled with a disciplined approach to acquiring and integrating additional transfer station volumes, allowed volumes and revenue to expand 200%+ and 6X under Prophet’s ownership, while also enhancing underlying profitability. Apex and the IWS transaction demonstrate what is possible when deploying a long-term value creation approach to investments.”

Darren Rizzo, President of Apex, and Anthony Rizzo, Apex COO, commented, “The Prophet Equity team was critical in supporting Apex’s initial acquisition as well as the organic and acquisition-led growth within the highly attractive northern New Jersey solid waste market. Their partnership has enabled the creation of the vertically integrated solid waste platform at IWS. We could not be more excited about both these accomplishments and our next phase of growth on this platform.”

“Apex is another example of a very successful partnership with industry veterans around a strategically strong platform that deserves the capital and know-how to realize transformative growth. From the initial recapitalization, to the tremendous buy & build based value creation success story, our unique hands on approach and the deployment of our Holistic Value Creation™ process is a testament to the value opportunity that can be unlocked in these situations,” added Ross Gatlin, Prophet’s CEO and Managing Partner. “We are excited about our partnership in IWS as significant investors and serving on its Board of Directors as it capitalizes on its position as one of the largest integrated solid waste companies in the largest waste market in the United States. We also thank the exceptionally experienced and talented management team at Apex for their commitment and dedication to maximizing value to date and going forward with IWS.”

Will Sirignano, a Managing Director at Blackstone commented, “We believe the formation of the new IWS is the right outcome for Apex, Action and their respective shareholders. We look forward to partnering with IWS and supporting the company’s long-term success by providing access to business cross-selling opportunities and cost savings through the GSO Advantage Program.”

Stifel, Nicolaus & Company, Incorporated acted as sole placement agent in connection with the equity and debt financing to support the transaction, and Jackson Walker LLP acted as legal counsel to Apex and Prophet Equity.

ABOUT PROPHET EQUITY

Prophet Equity is a private equity firm that uses proven, data-driven analytical techniques coupled with over 100 years of investment and management experience to invest in, unlock and realize future value today. Partnering with owners and management teams, Prophet Equity’s team utilizes a toolkit that is Fortune 500 tested and private equity proven to diagnose and drive dramatic value creation. Portfolio company management teams are highly motivated with clear, uncapped incentives based on realized business performance.

Over the last 20 plus years, Prophet Equity’s Principals have invested in and managed over $2.5 billion of value creation across entities with over $6 billion in revenue. Prophet Equity’s control equity investments focus on strategically strong, lower and middle market businesses with significant value creation potential. These are typically found in partnerships, corporate carve-outs, divestitures and non-strategic business units of larger companies. For more information, please visit www.prophetequity.com or call us at +1.817.898.1500.

ABOUT BLACKSTONE GSO

GSO Capital Partners is the global credit investing platform of Blackstone. GSO is one of the largest alternative managers of the world focused on the leveraged-finance marketplace, seeking to generate attractive risk-adjusted returns by investing in a broad array of strategies.

January 15, 2020 – Southlake, TX – Prophet Equity (“Prophet”), a Southlake, TX-based private equity firm, has completed the sale of its portfolio company, Allegiance Crane & Equipment, LLC (“Allegiance” or the “Company”)

Prophet acquired Allegiance in December 2010. The Company, which is headquartered in Houston, Texas, was able to expand through acquisitions and greenfield investments into two additional branches in Texas located in Corpus Christi and Midland/Odessa, along with two branch locations in Pompano Beach and Fort Myers, Florida. Through executing strategic initiatives, investment in the leadership team, and significant fleet capacity expansion, Prophet was able to transform the business into a diversified provider of crane and rigging services in the petrochemical, infrastructure, commercial construction, and power markets.

Michael Hirschfeld, Senior Vice President at Prophet Equity commented, “We thoroughly enjoyed the hands on approach with the Allegiance team over the past nine years. Allegiance’s disciplined focus on fleet expansion into high-margin growth markets, allowing revenue and EBITDA to expand ~4.5x and ~20x, respectively, shows what is possible when deploying a long-term value creation approach to businesses.”

Guy Huelat, CEO of Allegiance commented, “Since my arrival in late 2017, the Prophet Equity team was instrumental in supporting the repositioning of Allegiance within the markets and customers served, which has  enabled us to create a unique platform and I’m excited about our next phase of growth.”

“Allegiance is another example of a very successful buy & build turnaround and value creation success story, producing a fantastic outcome for our investors,” added Ross Gatlin, Prophet’s CEO and Managing Partner. “Our unique hands on approach and the deployment of our Holistic Value Creation™ (HVC™) process is a testament to the value opportunity that can be unlocked in businesses like Allegiance. We thank the exceptionally experienced management team at Allegiance for their commitment and dedication to maximizing value.”

Oppenheimer & Co. Inc. served as financial advisor and Jackson Walker as legal counsel to Allegiance and Prophet Equity.

About Prophet Equity

Prophet Equity is a private equity firm that makes control investments in strategically viable, asset-intensive, underperforming companies.  Over more than twenty years, our Principals have invested in and managed entities with over $6 billion in revenue.  Prophet Equity’s control equity investments focus on lower middle market companies with strategically strong businesses and significant value creation potential, such as those found in partnerships, corporate carve-outs, divestitures and non-strategic businesses of larger companies. Representative business situations have included special situations, succession planning, recapitalizations, acquisitions, and buy and build strategies.  Partnering with owners and management teams, Prophet Equity’s team of experts utilize a Holistic Value Creation™ (“HVC™”) strategy that is Fortune 500 tested and private equity proven to diagnose and drive dramatic value creation. Portfolio company management teams are highly motivated with clear, uncapped incentives based on realized business performance.  For more background on Prophet Equity, our approach and our team, please visit www.prophetequity.com

Columbia, SC – Prophet Equity announces that it has partnered with Jim and Adam Hills to make an equity investment to acquire a controlling interest in Hills Machinery Company (“HMC” or the “Company”). Headquartered in South Carolina, with seven locations that serve North and South Carolina, Hills is one of the largest CASE Construction dealerships in the United States, with a focus on heavy equipment offered by CASE Construction, Terex Trucks, a full line of recycling products, and other leading construction equipment manufacturers. HMC is one of the largest dealers in its regions with an emphasis on unmatched customer service.

Since 2007, when Adam and Jim Hills started the company, the business has experienced a dramatic growth which has seen the company expand fivefold during the last 12 years. “We have gone from being a smaller family-owned business to a much larger business and have been looking to find the right strategic partner,” said Jim Hills, President of HMC. “When we first met the Prophet Equity team, we recognized an immediate cultural fit and similar core operating principles as related to customers, employees and strategic growth. The partnership will also expand our financial resources, allowing us to continue to support our organic growth in our current branches plus help to facilitate strategic expansion opportunities. I could not be more pleased to have the opportunity to partner with Prophet Equity, and I am excited to get started.”

Charles Collie, Managing Director at Prophet Equity, commented, “We are incredibly fortunate to have the opportunity to partner with Jim, Adam and the HMC talented team, to support strategic growth initiatives. Through its reputation for customer service and strategic relationships with CASE Construction, Terex Trucks, Edge Innovate, Rubblemaster, Eagle Crushers, Mauldin and Ecoverse, there are tremendous opportunities for HMC. We expect the company to continue its excellent trajectory of organic growth through geographic expansion and through acquisitions to strengthen HMC’s market share in the Southern region.”

“Prophet Equity has deep experience investing in heavy equipment and equipment rental businesses,” commented Ross Gatlin, Prophet Equity’s CEO and Managing Partner. “We have a strong track record of identifying and investing in companies like HMC that have unique strategic strength and significant growth opportunities. We look forward to being a strategic, operational and financial partner to the entire HMC team.”

About Hills Machinery Company, LLC

Founded in 2007, Hills Machinery Company is a heavy equipment specialist serving a broad range of construction and recycling end-markets with an extremely flexible mix of parts, service, rentals and sales. Hills has 7 locations that serve North and South Carolina as well as parts of Georgia, Tennessee and Virginia with excellent OEM partnerships that include CASE Construction, Terex Trucks, Edge Innovate, Rubblemaster, Eagle Crushers, Mauldin, and Ecoverse. For more information, visit Hills Machinery’s website at www.hillsmachinery.com.

About Prophet Equity