Mason Wells Newsletter 2022 – Volume 1

• Mason Wells Announces the Sales of Two Fund III Portfolio Companies
• Mason Wells Acquires Onyx Brands, LLC
• KDV Labels, LLC Hires New CFO
• RJW Logistics Group Announces Warehouse Expansion
• Mason Wells Seeks to Acquire Conveying Equipment Manufacturer
• Effective January 1, 2022, Mason Wells Announced Staff Promotions

Mason Wells is pleased to announce the recent sales of two portfolio companies of Mason Wells Buyout Fund III, LP (“Fund III”). The Fund sold Whitehall Specialties, Inc. (“Whitehall”) in October 2021, and Paragon Development Systems, Inc. (“PDS”) in January 2022.

“The PDS and Whitehall sales mark the exits of our last two portfolio companies in our 2010-vintage Fund III,” said Tom Smith, Executive Managing Director of Mason Wells. “We are very proud of Fund III and the dedicated hard work of all of the team members at each of the companies we sponsored over the past 11 years.”

Whitehall was sold to an affiliate of Ornua Co-operative Limited on October 8, 2021. Whitehall provides innovative functional analog, plant-based, and blended cheese products and cheese solutions to its longstanding food manufacturing, retail, and foodservice customers. Headquartered in Whitehall, Wisconsin, Whitehall has approximately 450 employees across its four well-invested production and warehouse facilities. Quarles & Brady served as legal counsel. For more information, please visit Whitehall’s website at www.whitehall-specialties.com.

PDS was sold to Converge Technology Solutions on January 7, 2022. PDS is an IT solutions provider serving clients in the Healthcare, Corporate, and Public sectors. Headquartered in Brookfield, Wisconsin, PDS has approximately 375 employees across its four locations. PDS was advised by Canaccord Genuity, and Foley & Lardner served as legal counsel. For more information, please visit PDS’s website at www.pdsit.net.

Mason Wells announced on October 28, 2021, that it closed the acquisition of Onyx Brands, Inc. (“Onyx” or the “Company”), a Mason Wells Buyout Fund V, LP portfolio company. Onyx is a leading supplier of branded beauty and personal care products. CEO Marsha Martin, an experienced beauty executive, established the Company in 1990. The Company will be owned by Mason Wells, Marsha Martin, and other board member co-investors.

Onyx is a designer, marketer, and manufacturer of branded beauty and personal care products for retail and e-commerce customers. The Company is growing rapidly and positioned squarely within the secular “self-care” beauty and personal care trends. The Company’s key product categories include (i) nail polish remover, (ii) foot care treatments and tools, (iii) specialty bath accessories, (iv) nail care, and (v) makeup mirrors and cosmetic bags. Onyx products are marketed under the Onyx brand across customers. The Company is headquartered in Little Rock, Arkansas, with an additional office in Bentonville, Arkansas.

“We are extremely excited about our Mason Wells partnership,” said Marsha Martin, CEO of Onyx. “They bring valuable insights and resources to Onyx based on prior investment experience in health & beauty companies that will help support long-term growth.”

Onyx’s experienced management team will be led by Marsha Martin, who is continuing as CEO. The Company will continue to leverage its brand and strong foundation in product development, supply chain management, and deep customer relationships to expand distribution and drive growth.

For more information, please visit the Onyx website at www.onyxbrands.com.

KDV Labels, LLC, a Mason Wells Buyout Fund IV, LP portfolio company and a label converter for a diverse set of consumer end markets including beverage, food, household cleaning, and personal care, recently appointed Keith Walz as its Chief Financial Officer. KDV’s prior CFO, Andy Hulen, will remain with the company as VP-Finance and Administration reporting to Keith Walz.

Mr. Walz is a seasoned financial executive with extensive experience, including tenures at Jason Industries and Brady Corporation, as well as with investment organizations and private equity firms.

Mr. Walz brings with him an extensive background in the manufacturing industry focusing on company improvement and profit optimization, revenue and EBITDA growth strategy formulation, and business development, with a proven track record of managing and growing teams to achieve organizational objectives. He holds a Master of Business Administration in Finance from DePaul University and a Bachelor of Science degree from the University of Arkansas.

As CFO, Mr. Walz will be a key member of the leadership team. He will be responsible for ensuring that the finance and accounting teams, as well as KDV’s M&A initiatives, continue to support KDV’s growth.

For more information, please visit the Company’s website at www.kdvlabel.com.

RJW Logistics Group, Inc., a leading provider of retail logistics solutions for consumer packaged goods companies and a Mason Wells Buyout Fund IV, LP portfolio company, recently announced the opening of its eighth warehouse to accommodate the growth of its integrated logistics program.

At 452,000 square feet, the new Romeoville, Illinois, facility is the latest addition to RJW’s retail logistics operation and will serve over 120 CPG customers, receive an estimated 550,000 pallets, and ship 66 million cases or more annually.

By controlling supplier inventory from one strategic location, RJW produces economies of scale and eliminates supply chain redundancies for streamlined operations and product delivery. Suppliers and retailers realize improved scorecard performance, higher in-stocks, line extensions at retail, and optimized inventory processes. This model has helped RJW maintain its high performance throughout the pandemic, assisting suppliers with inventory management and retailer compliance.

“RJW’s one inventory strategy eliminates redundancies at distribution centers and drives efficiencies,” said Kevin Williamson, Chief Executive Officer of RJW. “This approach is differentiating. It translates to reduced operational costs and more consistent product flow while allowing us to effectively scale with our customers and acquire new CPG suppliers. We’re positioned to meet increased demand and continue to deliver industry-leading performance in today’s tight, unpredictable market.”

As a certified SmartWay carrier by the EPA, RJW is committed to green business practices that minimize its environmental footprint and promote sustainability. The Company’s facilities are LEED certified and equipped with motion sensor lighting, skylights, and battery-operated equipment. A recycling program for corrugate, wood, paper, and plastic averages 100 tons monthly across the network, and trash compactors in each facility reduce the number of truck pick-ups. By centralizing customers’ inventory in Chicagoland, truckload and less-than-truckload shipments do not travel to regional warehouses, thereby reducing carbon emissions, diesel fuel consumption, and general supply chain redundancies. Further, RJW’s top retail consolidation program limits the number of trucks on the road at any given time, with one retail consolidation load eliminating an average of 13 complex LTL loads with many stops, in many regions, along a single route.

For more information, please visit the Company’s website at www.rjwgroup.com.

Mason Wells is actively seeking a platform company acquisition in the conveying equipment space. The company should possess some or all of the following characteristics:

• Product Categories: belt, chain, mat top, roller, or wheel conveyors designed for transportation, accumulation, positioning, and sortation applications
  • Highly engineered with differentiated features and capabilities
  • Use in demanding environments with a high cost of failure
• End Markets: medical/pharma, food & beverage, consumer products, packaging, distribution, automation, and general industrial
• Branded and/or private label products
• Intellectual property through patents, trademarks, and/or proprietary know-how
• Recurring maintenance, repair, and accessory opportunities
• Annual revenue greater than $50 million and headquartered in the Midwestern United States
  • Companies with less than $50 million of revenue and outside of the Midwest will be considered for follow-on acquisitions

Market trends, including ongoing reshoring of North American manufacturing, rapid growth in e-commerce, labor shortages, and rising labor costs, are examples of key industry dynamics that present compelling growth opportunities for the material handling sector. Mason Wells possesses relationships with material handling executives to assist these businesses in growing organically, improving profitability, and executing acquisitions.

All inquiries will be treated with strict confidentiality. Please contact Mike Wirth, Director, at 414-727-6413 or mwirth@masonwells.com.

Chris Pummill was promoted to Managing Director. Since joining Mason Wells in 2011, Mr. Pummill has played a critical role in driving value creation at portfolio companies in the Consumer Packaged Goods and Label Converting sectors. Mr. Pummill led the 2018 investment in recreational sporting goods company EastPoint Sports. He also led the 2021 investments in durable industrial labels companies Reliance Label Solutions and IDENTCO International to form Industrial Labels Holding Corporation (“ILH”). Mr. Pummill was also a former Board member of AWT Labels & Packaging and Pacon Corporation. Mr. Pummill previously served in the roles of Director, Vice President, Senior Associate, and Associate at Mason Wells.

Michael Graves was promoted to Director. Since joining Mason Wells in 2013, Mr. Graves has played an active role in the acquisition, value creation, and sale of a number of Mason Wells portfolio companies.  Most notably, Mr. Graves was instrumental in the sales of Fund II portfolio companies Oilgear and Dedicated Computing as well as Fund III portfolio companies PDS, Whitehall, Qualus, AWT, Nelipak, A&R, Eddy, Pacon, Mullinix, and Paris Presents.

In addition to portfolio company responsibilities, Mr. Graves has actively managed a variety of fund and portfolio-level activities across the firm, including valuations, investor reporting, fundraising, and fund reporting and analysis.  Mr. Graves previously served in the roles of Vice President, Senior Associate, and Associate at Mason Wells.

Dan Shanahan was promoted to Vice President. Since joining Mason Wells in 2018, Mr. Shanahan is primarily responsible for supporting the funds’ investment activities. In this capacity, he is responsible for investment analysis, due diligence, limited partner reporting, working with portfolio company management teams, negotiating transactions, and arranging for the sale of investments.

Mr. Shanahan currently serves on the Board of Directors of Onyx Brands and Structural Concepts Corporation. Mr. Shanahan previously served in the roles of Senior Associate and Associate at Mason Wells.