A Fort Lee-based company involved with the manufacture, sale and service of electrical transmission, distribution and on-site power generation equipment is offloading its liquid filled and dry type transformer businesses to Mill Point Capital.
On Monday, Pioneer Power Solutions Inc. announced it has reached an agreement with Mill Point Capital for the assets of Pioneer Transformers Ltd. and Pioneer Dry Type Transformer Group – which includes Jefferson Electric Inc., Bemag Transformer Inc. and Harmonics Limited LLC – for $65.5 million in cash and notes.
The deal is expected to close in the second half of 2019, subject to customary closing conditions and Mill Point’s securing of financing for the transaction.
Mill Point Capital is a middle-market private equity firm. According to Pioneer, Mill Point will assume all current assets and liabilities.
Pioneer meanwhile, will hold onto Pioneer Critical Power and Pioneer Custom Electrical Products. Additionally, the company said it holds 1.75 million share and warrants to purchase an additional 1 million share of CleanSpark Inc.
Pioneer Chairman and Chief Executive Officer Nathan Mazurek said the company felt its assets were worth more on their own, and the value of the transaction supports that belief.
“Following the closing of this transaction, we plan to focus on streamlining and enhancing our Titan business in Minneapolis and our switchgear business in Los Angeles,” he said in a prepared statement. “With a strong balance sheet, we should be well positioned to assess our retained businesses, potential opportunities and the allocation of resources to best benefit shareholders.
“I am excited about phase two of Pioneer,” he added.
Lincoln International acted as financial advisor to Pioneer.