Article

Nautic Partners LLC Joins With Management to Acquire Precision Engineered Products, Inc.

Transaction Is Firm's Fifth New Investment In 2006
Providence, RI

Nautic Partners, LLC (“Nautic”), a private equity firm with more than $1.8 billion of capital under management, today announced that it has acquired Precision Engineered Products, Inc. (“ PEP ”) in partnership with PEP management. Headquartered in Attleboro, Massachusetts, PEP is a manufacturer and marketer of highly-engineered fabricated parts, technical surface finishes, specialty and clad metals, and micron tolerance molded plastic components.

PEP has a 67-year history in its core business as a leading and innovative manufacturer of precision metal stampings and silver bearing electrical contacts. PEP applies its proprietary technologies in die design, construction, and high speed stamping to produce close tolerance, intricate parts. It was one of the first precision stampers to leverage its capabilities with sophisticated surface finishing and close tolerance plastic molding to provide integrated solutions to its customers worldwide. PEP’s components are sold into a diverse set of end-markets including transportation, electrical control, medical, defense, and electronics. Examples of end-use applications for PEP components include hybrid automotive airbag safety systems, electronic sensors, hearing aids, and other micro audio components.

Fred Hammerle, Precision’s CEO, said “We are excited to work with Nautic as we execute our strategic initiatives for continued growth. With Nautic’s financial support and strategic expertise, we look forward to continuing to build upon our long record of excellent growth in sales, earnings and cash generation.”

“PEP has a strong competitive position in its precision manufacturing markets,” said Doug Hill, Principal of Nautic. “Precision enjoys long-term customer relationships due to its reputation for quality, supply chain management, and its diverse range of manufacturing capabilities. With its presence in growth markets such as medical, defense and safety restraints, we believe PEP is well-positioned for continued growth and success.”

“PEP is led by a talented group of managers who have grown the business together for many years,” said Bernie Buonanno, Managing Director of Nautic. “We look forward to supporting the PEP team as they combine continued organic growth in their existing business with strategic acquisitions that will help expand PEP into new and complementary products, technologies, and geographies.”

GE Antares Capital arranged the senior debt financing. Terms of the transaction were not disclosed.

The investment in PEP represents Nautic’s fifth new investment in 2006. In February, Nautic announced the acquisition of Oasis Outsourcing, LLC, one of the largest professional employer organizations in the U.S. In April, Nautic announced investments in Curtis Industries Holdings, LLC, the leading manufacturer of cabs and enclosures for utility vehicles, compact tractors, and golf carts and 1105 Media Holdings, LLC, a company formed to acquire and operate companies in the business-to-business information industry. In May, Nautic announced the acquisition of Big Train, Inc., a leading manufacturer and distributor of powdered and liquid beverage products

About Precision Engineered Products, Inc.

Headquartered in Attleboro, Massachusetts and with manufacturing facilities in Illinois, Ohio, Rhode Island, Mexico and China, PEP is a manufacturer and marketer of highly engineered precious and base metal fabricated parts, technical surface finishes, clad and specialty alloy products, and micron tolerance molded plastic components. For more information about PEP and its subsidiaries, visit www.pep-corp.com.

Certain statements about Nautic made by portfolio company executives herein are intended to illustrate Nautic’s business relationship with such persons, including with respect to Nautic’s facilities as a business partner, rather than Nautic’s capabilities or expertise with respect to investment advisory services. Portfolio company executives were not compensated in connection with their participation, although they generally receive compensation and investment opportunities in connection with their portfolio company roles, and in certain cases are also owners of portfolio company securities and/or investors in Nautic-sponsored vehicles. Such compensation and investments subject participants to potential conflicts of interest in making the statements herein.