Carlyle Completes Vigor, MHI Holdings Acquisition

Image courtesy Vigor Industrial

Global investment firm The Carlyle Group (NASDAQ: CG) and private equity firm Stellex Capital Management today announced they have closed on their acquisition of Portland, Oregon-based Vigor Industrial and Norfolk, Virginia-based MHI Holdings.

As part of the agreement, Vigor Industrial LLC, an infrastructure, defense, and maritime services company, will be merged with MHI Holdings LLC, a ship repair, maintenance, and other ship husbandry services company.

The merged company seeks to become a “bicoastal leader” in ship repair services and commercial and defense-related fabrication services, with customers comprised of the U.S. Navy, U.S. Coast Guard, Military Sealift Command, Boeing, cruise lines, fishing fleets, barges and ferry services for local and state governments.

The Carlyle Group is the majority owner of the combined company.

Carlyle and Stellex said they have appointed Jim Marcotuli as CEO of the newly created company, effective today.

“Vigor and MHI have tremendous potential for growth and I am grateful for the opportunity to lead the new company,” said Marcotuli. “I am eager to engage with the employees who have made these companies what they are today, and to work with the team to create sustainable value for our customers.”

Marcotuli brings more than 30 years of experience in the defense and manufacturing industries.

“Jim is a proven leader who excels at driving strong performance through motivating and building great teams,” said Derek Whang, Principal at The Carlyle Group. “He is a natural fit for Vigor and MHI, both in his leadership style and his background, and we’re looking forward to partnering with Jim and all employees and supporting them in this next phase of growth.”

Frank Foti, Vigor’s founding CEO and prior majority owner, has stepped out of his role as CEO of Vigor while remaining an investor in the new parent company and serving as its Vice Chairman of the Board of Directors.

Tom Epley will continue to lead MHI Ship Repair & Services LLC and MHI Holdings LLC and will report to Marcotuli.

“Through this transaction, Vigor gains responsible, forward-thinking investors who will seek to build on our current platform while maintaining a values-driven culture,” Foti said in July upon the announcement of the deal. “In addition, we are excited to join forces with a company of MHI’s caliber which has a history of delivering strong results and shares our mission to serve the people who protect our country every day. This evolution takes us where we want to go, growing sustainable jobs into the future. I’m excited to be an investor in this adventure and to be a part of what’s to come.”

Carlyle’s equity for the investment came from the Carlyle U.S. Equity Opportunity Fund II, a $2.4 billion fund that focuses on middle-market and growth companies in the United States and Canada.