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May 10, 2010
Altus deals Gichner Holdings - The private equity firm nets 6.7x on its investment, sells its government supplies provider to Kratos

Private Placement Letter / Mergers Unleashed; By Jonathan Marino

May 20, 2010 Altus Capital Partners sold its Gichner Holdings to Kratos Defense, the listed, San Diego-based defense and government services firm, for $133 million.

“We accomplished several strategic objectives,” said Altus’ founder and managing partner Russ Greenberg.

Greenberg went on to say that Altus’ return on its equity was 6.7x, resulting in an IRR of 101 percent.

He added that Altus, while mostly through its first fund, is still deploying capital in the form of bolt-on acquisitions for its industrials companies.

In 2008, Gichner acquired Charleston Marine Containers, a South Carolina-based company that also makes specialty containers for government clients.

The previous year, Connecticut-based Altus Capital and Dunrath Capital, acting as co-equity investors, bought all of Gichner’s assets from Dominion Capital, a subsidiary of Dominion Resources. Terms of the deal were not disclosed.

Gichner more than tripled its revenue from 2007 to 2009, when its top line for the year ending Dec. 31, 2009 was more than $147 million.

Jefferies & Co. advised Altus on the deal.

Deals in the government services and solutions space have often been targeted by private equity firms as of late.

In January, Summit Partners, the Boston-based PE firms, pumped an unspecified sum into NetWitness Corp., a DC-area security networks operator.

Other PE players in the space include GTCR, CI Capital Partners, Providence Equity Partners, Veritas Capital and Riordan, Lewis & Haden Equity Partners.