March 6, 2019
Wind Point Partners to sell Paragon Films to Wellspring Capital Management
Chicago, Illinois and New York, New York – March 6, 2019 –Wind Point Partners (“Wind Point”) and Wellspring Capital Management (“Wellspring”) today announced that Wellspring has signed a definitive agreement to acquire Paragon Films (“Paragon” or the “Company”) from Wind Point. Paragon is a leading manufacturer of high-performance transit packaging films within North America. Terms of the transaction were not disclosed. The transaction is expected to close within the next 45 days.
Based in Broken Arrow, Oklahoma, Paragon produces stretch films which are principally used to unitize pallet loads while in storage and transit. The market for high-performance stretch film is experiencing significant growth driven by transportation and e-commerce trends that are increasing points of distribution and warehousing, as well as raising the technical requirements for secure packaging.
“Paragon is a case study in Wind Point’s investment strategy of assisting family-owned companies to affect a successful leadership transition and unlock additional areas for equity value creation. We thank Darin and the management team for their partnership in delivering an outstanding outcome.”
Alex Washington, Managing Director
In December 2016, Wind Point partnered with Darin Tang to acquire Paragon from the Company’s founder, Mike Baab. Darin, former Senior Vice President of Packaging at Veritiv, added considerable commercial skills and relationships to the Company, augmenting the market leading operational and technology capabilities built over Paragon’s 30-year history. That combination, along with over $10 million in capital investment for capacity expansion, accelerated revenue and earnings growth to double digit rates under Wind Point’s ownership.
Alex Washington, Managing Director at Wind Point, commented, “Paragon is a case study in Wind Point’s investment strategy of assisting family-owned companies to affect a successful leadership transition and unlock additional areas for equity value creation. We thank Darin and the management team for their partnership in delivering an outstanding outcome.”
“I want to thank Wind Point and our board for their tremendous support over the last two plus years,” stated Mr. Tang. “The Paragon team has delivered strong results over this time period and are proud of our successes. We very much look forward to continuing our momentum with our new Wellspring partnership.”
John Morningstar, Managing Partner at Wellspring, stated, “We look forward to building upon the success that Wind Point and the Company have achieved and are particularly excited to do so with the team that is currently in place. Darin and his team have built an excellent culture at Paragon that fits very well with our approach.”
Kirkland & Ellis served as legal counsel to Paragon Films, while Rothschild & Co. and Robert W. Baird acted as financial advisors to the Company. McDermott Will & Emery served as legal counsel to Wellspring. Antares Holdings, NXT Capital, Newstone Capital, and Blackrock Kelso will provide financing for the transaction.