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Riverside sells Sentinel for GBP43m

 The Riverside Company sold Sentinel Performance Solutions Limited (Sentinel), a leading European supplier of residential heating and hot water system treatment products, to Electra Partners. The exit for a sale price of GBP43 million generated a combined 3x gross cash-on-cash return and a 22% gross IRR to Riverside and its investors.

 
Sentinel, based in Runcorn, England, has market-leading positions in the UK, France, Italy and Germany. Sentinel’s biodegradable and OEM-recommended products clean and prevent corrosion in heating systems, improving energy efficiency and increasing system lifespan.
 
Riverside invested in Sentinel in August 2005, as a corporate carve-out from General Electric. Riverside transformed Sentinel from a small corporate division to a standalone company with operations and personnel spread across six countries. Riverside helped strengthen the management team and worked with them to build the systems and processes to position the company for future growth. During Riverside’s ownership, Sentinel added a range of products and customers with the 2007 add-on acquisition of Salamander Engineering Ltd. a smaller UK-based competitor. The firm also helped Sentinel launch 24 new products, including its flagship X800 line.
 
“We’re proud of the work we did with Sentinel,” says Riverside Managing Partner Suzy Kriscunas. “We harnessed Sentinel’s potential, working with management to expand the company’s strong UK position, build sales channels in Benelux, France, Italy and Germany and initiate sales in the US Sentinel is well positioned to build on this strong growth foundation going forward.”
 
The investment was truly international for the global firm, as it involved two Riverside funds – the North America-based Riverside Capital Appreciation Fund and the Riverside Europe Fund. Having deal team members on both sides of the Atlantic delivered a broad range of insight and experience to the company.
 
In addition to building and strengthening Sentinel’s core hot water system sales, Riverside helped Sentinel capitalise on the growing renewable energy market and build on Sentinel’s environmentally friendly reputation.
 
“We saw some compelling opportunities to expand Sentinel’s offerings,” says Riverside Partner Volker Schmidt (pictured). “The company now has a comprehensive product line for renewable heating systems, which can be used in solar thermal, air source and ground source heat pump heating systems.”
 
Principal Trey Vincent and Vice President Scott Bogard worked with Schmidt and Kriscunas on the transaction for Riverside. Riverside’s Associate Director of Origination, Amy Margolis, worked with the deal team and the sell side advisor to facilitate the exit.
 
Lincoln International advised Riverside on the sale of Sentinel to Electra Partners. Jones Day, KPMG and LEK provided legal, financial and commercial support.
 

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