March 2007
MML Capital Partners ("MML"), a leading independent mezzanine and private equity firm, today announces that it has completed the sale of XServ Inc., a majority owned portfolio company, to The Brock Group. The acquisition is being funded with equity provided by Lindsay Goldberg & Bessemer, the Brock family and management members of the combined companies, as well as with debt financing provided by Bank of America and JPMorgan. The consideration for the transaction is undisclosed.
MML invested in Xserv from Fund III. The sale of XServ represents MML’s third successful realisation this year following the completion of the sale of Telediffusion de France (TDF), the French television and mobile phone transmission business, to a consortium led by Texas Pacific Group, and the sale of Hawkpoint to Collins Stewart. These follow the successful realisation of MML’s investment in Target Express at the end of 2006.
MML provided acquisition financing through a combination of equity and mezzanine debt. MML made subsequent investments to expand XServ’s infrastructure and equipment to better serve its Fortune 500 customers in the chemical, refining and power markets. These follow-on investments resulted in MML becoming the majority owner of XServ. Through its involvement on the XServ’s board, and working closely with the management team, MML contributed to the Company establishing a leadership position in its markets.
Commenting on the transaction, James A. Read, co-founder of MML said: “MML's investment in XServ not only provided an excellent return to our investors but demonstrates our value added investment philosophy of working with management to build enterprise value. We are proud of our association with XServ and we wish the entire team success in the future.”
Michael E. McGinnis, XServ’s CEO, added: “Since their initial investment, MML proved to be a true partner in implementing the Company’s strategy. Their guidance and commitment has been invaluable and greatly appreciated by the management team.”
XServ is the leading provider of specialty maintenance services to chemical, refining, power and other industrial process facilities in the United States. The Company provides a comprehensive portfolio of services, including industrial scaffolding, insulation, abatement, coating and painting, and other services that are critical to minimizing costly plant downtime and maximizing profitability for its customers. With over 30 years of experience, XServ has earned an industry leading reputation for
delivering critical time sensitive services with superior safety, execution and savings to customers.
Advisers on the XServ transaction included: to XServ - Porter & Hedges LLP (legal) and JPMorgan (financial); to The Brock Group - Weil, Gotshal & Manges LLP (legal).