Castle Harlan: Sells RathGibson to DLJ Merchant Banking

NEW YORK, June 18 /PRNewswire/ — Castle Harlan, Inc., the New York-based private equity investment firm, announced today that it has completed the sale of RathGibson Inc., a leading manufacturer of highly engineered premium stainless steel and specialty alloy welded tubing products, to DLJ Merchant Banking Partners (DLJ), for $440 million.

Castle Harlan had purchased RathGibson, based in Janesville, Wisconsin, in February 2006. In August of last year, RathGibson acquired a complementary tubing manufacturer, Greenville Tube Company. The combined companies had total revenues of $311 million for the fiscal year ended January 31, 2007.

Castle Harlan and DLJ, also a New York private equity firm, had announced in April that they had signed a definitive agreement on the transaction.

William Pruellage, a managing director who led the Castle Harlan negotiating team, said RathGibson’s revenues and earnings increased by approximately 50 percent during the period Castle Harlan owned the company.

“The company is strong and poised for significant growth in both its domestic and international markets,” Pruellage said. “It has an outstanding management team, led by President and Chief Executive Officer Harley Kaplan, and we are confident it has a very promising future with DLJ.”

RathGibson manufactures a variety of straight and coiled welded stainless steel and specialty alloy tubing products and has a leading share in a number of niche markets. Its primary end markets include the chemical and petrochemical, energy, food and beverage and pharmaceutical industries.

The company has manufacturing facilities in Janesville, Wisconsin; North Branch, New Jersey; and Clarksville, Arkansas.

Castle Harlan, founded in 1987, invests in controlling interests in the buyout and development of middle-market companies in North America and Europe. Its team of 19 investment professionals has completed 48 acquisitions since its inception with a total value of $9 billion. The firm traces its roots to the start of the institutionalized private-equity business in the late 1960s.

Castle Harlan’s current portfolio companies, which employ more than 42,000 people, include Ames True Temper, a leading manufacturer of lawn and garden tools and accessories; Baker & Taylor, the world’s largest book wholesaler, and Perkins & Marie Callender’s, Inc., which operates and franchises 615 family restaurants in the United States and Canada.