Watermill Group

Client Profile
Watermill Group is a strategy-driven private investment firm based in Boston that has closed over 60 transactions in its 34 year history. Superior and Fine Tubes are both leading manufacturers of customized small diameter tubular products for a variety of desirable end markets. They fabricate seamless and welded tubing from high-value specialty alloys including stainless steels, titanium, and high nickel alloys. Superior’s operations are in Collegeville, PA while Fine Tubes is located in Plymouth, U.K. Both companies are owned by Superior Group, Inc., a holding company with controlling positions in a variety of manufacturing businesses.
Situation
Watermill executed a letter of intent to acquire Superior and Fine Tubes and shortly thereafter retained SSG to help deliver creative financing alternatives in light of the complexity of the transaction, including the fact that over half of the collateral base was located in the United Kingdom.
Solution
SSG quickly went to market and sourced multiple term sheets. SSG worked closely with Watermill to negotiate a transaction structure that included a senior working capital lender and a senior term loan lender that would provide financing in the United States and internationally. The senior term loan lender also was able to lend beyond the fixed asset collateral pool and minimize amortization at the outset of the term so that more capital could stay in the business to support Watermill’s growth strategy. The transaction closed in September 2012.