Special Products Company

Company Description

SPC is the largest designer and manufacturer of telecom DSL repeater cases for last mile connectivity using copper. We expanded the product line to include fiber boxes and integrated cabinets for diverse customers. Not only do we serve the original telco customers, we now serve cable, 5G/wireless, FTTX, IOT.

Transaction Background

Originally, we received a teaser from Goldsmith Agio, now part of Lazard. We were attracted by SPC’s financial performance, nascent solutions for the last mile, large serviceable obtainable market, established customer base with high switching costs, and unique heat dissipation technology. After thorough due diligence, we partnered with Electra Private Equity to acquire the company.

Weathered Through the Tech Bubble and the Great Recession

Soon after the closing, the Dotcom bubble burst in early 2000s. SPC lost much revenue but we struggled on. We bought the bank debt at 8 cents on the dollar. After going through tough times such as the Great Recession of 2008, different CEOs, SPC stabilized its product lines, and expanded to new types of customers.  Revenues and EBITDA have surged in the last few years.

Accomplishments

• Hired new top management team – CEO, CFO, VP Sales

• Introduced new product lines

• Gained market share to dominate the T1 repeater case niche

• Improved supply chain and gross margin

• Improved plant performance through lean manufacturing

• By 2019, revenues and profitability had reached a high mark of that would return a cash on cash return of over 2.5 X.

Outcome

After 20 years of ownership, SPC was sold to PPC, a Belden brand.