Hamilton Robinson Capital Partners Automates The Warehouses Of The Future With Acquisition of Zone 4
Hamilton Robinson Capital Partners, together with management, has recapitalized Zone 4, a leader in the installation of automated storage and retrieval systems, advanced material handling and rack storage systems servicing the retail, e-commerce, logistics, and grocery sectors nationwide. Headquartered in Orange, CA, the company’s core base of blue-chip customers leads the world in automated warehouse logistics.
Adam Fitzner, Managing Director at Hamilton Robinson stated, “We are very fortunate to have the opportunity to partner with the Zone 4 team who are leaders in this dynamic, high-growth industry. Our experience with automation and our additional resources will provide the team with support to continue offering the highest levels of quality and service, and accelerate their plans for rapid organic growth.”
“We are excited to have found a partner that aligns so closely with Zone 4’s values, company culture, and vision for the future. With Hamilton Robinson’s leadership and resources, we will be able to scale faster, build capacity and expand our portfolio of services to help our current and future customers compete in the growing autonomous robotics industry,” stated Steve Martinez, CEO of Zone 4.
“Zone 4 is consistent with the Hamilton Robinson investment theme for technical industrial services. We are excited about the opportunity to execute on an aggressive acquisition strategy that will help the team to broaden their capabilities into new segments, as well as provide more depth and bench strength. The current management team will continue to run the business and we have added a number of other key Zone 4 managers into the ownership group going forward,” stated Brandon Richter, Partner at Hamilton Robinson.
Finn Dixon & Herling LLP and Crowe LLP provided legal and accounting advisory services to Hamilton Robinson, respectively.
ABOUT ZONE 4
Zone 4 is a leader in the installation of automated storage and retrieval systems, advanced material handling and rack storage systems servicing the retail, e-commerce, logistics, and grocery sectors nationwide. Delivering unparalleled expertise implementing automated storage/retrieval systems (AS/RS), multi-shuttle, and mini-load systems in the rapidly expanding e-commerce and food delivery markets.
Hamilton Robinson Capital Partners’ portfolio company, American Roller, has expanded its service to the Northeast and Canada with the acquisition of Northern Roller. Northern Roller, located in Mississauga, Canada, is a rubber roller facility that will expand the company’s integrated network of pickup and delivery capabilities unmatched in the industry.
Northern Roller, led by Ron Zawacki and his team, bring extensive knowledge of the industry and will become part of the American Roller global product management team. “American Roller remains the only one-stop shop in the industry with core, coverings and coatings in-house enabling us to drive solutions of value as opposed to selling unit price rollers. Ron and his team coming into our network of facilities and being part of our global product management team adds to our unmatched depth in the industry,” says Dan Cahalane, President & CEO of American Roller.
Adam Fitzner, Managing Director at Hamilton Robinson stated, “We are very excited about the addition of Northern Roller, the first of several acquisitions we plan to make. Northern is led by a strong team that fits well culturally with American Roller. The business provides us with improved ability to service several new regions and allows us to cross-sell multiple new offerings there.”
ABOUT AMERICAN ROLLER
American Roller Company is an industry leading provider of engineered services and industrial rollers including rubber and urethane coverings, plasma coatings, and core fabrication. Founded in 1938 and based in Union Grove, WI. American Roller has multiple facilities spread throughout the United States and a facility in China. Operating under the American Roller, Plasma Coatings, and C.R.E.W. brand names, American Roller is committed to providing its valued customers ever-improving products, services, and performance.
Over the past nine months, we have all relied upon technology to bridge the gap between the real world and the virtual world. We are living through one of the greatest periods of “e-merge” in our history. Gartner reports 87% of senior business leaders say digitalization is a company priority, but only 40% of organizations have brought digital initiatives to scale as of today.
At Hamilton Robinson we have taken “e-merge” to the next level. Our portfolio company, GrayMatter, is proud to announce the acquisition of E-Merge Systems. E-Merge, based in Richmond, VA, focuses on delivering industrial systems integration and implementation that optimize efficiency and quality in manufacturing, food & beverage, water/wastewater, energy and other industries across North America.
“The combination of GrayMatter and E-Merge creates the leading industrial intelligence and automation services firm in the U.S.,” stated Jim Parmelee, Managing Director at Hamilton Robinson Capital Partners. “GrayMatter is poised to provide customers with a comprehensive suite of services spanning instrumentation/control through analytics and cyber security.”
“Industrial companies in 2021 are prioritizing projects that were once on the back burner to equip facilities with IoT devices, leverage predictive analytics and augment industrial cybersecurity,” said GrayMatter Co-Founder and CEO James Gillespie. “Our clients are telling us they want to better prepare their remote, industrial workforces to control costs and production as we move closer to a post-pandemic world.”
Brandon Richter, Partner at Hamilton Robinson, stated, “E-Merge will add experienced engineers to GrayMatter’s workforce and a portfolio of impressive industrial clients. E-Merge’s team advances GrayMatter’s ability to meet customer demand for end-to-end operational visibility, putting powerful, relevant data from the sensor level to the cloud into the hands of decision makers.”
GrayMatter was advised by Bundy Group, a boutique investment bank that specializes in the controls & automation sector, in the sale.
ABOUT GRAYMATTER
Headquartered outside Pittsburgh, PA, GrayMatter leverages advanced industrial analytics, industrial cybersecurity, brilliant operations and other as-a-service solutions to help companies transform their operations and empower their people.
We send out a huge thank you to all our American manufacturers that transformed their operations to produce essential supplies and equipment to battle COVID-19. Check out the Society of Manufacturing Engineer’s (SME) Heroes Edition for some Friday inspiration!
- Manufacturing in the US employs more than 12.1 million people
- Manufacturing contributes $2.36 trillion to the U.S. economy annually
- Manufacturing has the largest economic multiplier of any major sector
- Manufacturing accounts for 63% of private-sector research and development
Hamilton Robinson has teamed up with US industrial companies for over 35 years and just completed its 60th acquisition. Our current partnerships span the US from New York to Mississippi to Washington state and all were deemed essential businesses. We were awed at every weekly Town Hall meeting by the ability of our CEOs and management teams to maintain the safety of all employees and the productivity of the business. We all know significant challenges still remain ahead but optimism is beginning to rebound.
Like many US companies, our sights are set on not just recovering but adapting and seizing new opportunities. Please reach out to us if you have any clients who would like to explore how a partnership with Hamilton Robinson could increase a company’s agility, visibility and productivity in today’s COVID environment and long into the future.
MIDDLE MARKET GROWTH MAGAZINE
Jul/Aug 2020
Quick Takes
– By Benjamin Glick
Underground storage tanks used by gas stations and other fuel suppliers are leading sources of groundwater pollution, an environmental and pulic health threat that one company is trying to mitigate through its testing and compliance offerings.
Tanknology, an environmental services company headquartered in Austin, Texas, was founded in the late 1980s, around the time that Congress expanded the Environmental Protection Agency’s authority to set groundwater quality standards, through an amendment to the Clean Water Drinking Act.
The company began by developing contamination tests and equipment to measure the structural integrity of underground fuel tanks. Exxon, Shell
and Chevron were among its early clients.
Tanknology continues to work with multinational oil companies, but it has since expanded its customer base to include major airlines, car rental
agencies and convenience store chains like 7-Eleven and Circle K.
As state and federal regulations for water quality have tightened over the decades, Tanknology has created new testing equipment and procedures to ensure its customers remain compliant. The company has licensed its brand and technology to independent businesses in 27 countries that adopt its testing methodology.
According to Allen Porter, Tanknology’s president and CEO, the EPA and local environmental regulators can require that the average gas station undergo 16 or more environmental tests annually in order to avoid costly fines.
Many of Tanknology’s clients, however, do more than the minimum, Porter says. Their internal
environmental, social and corporate governance, or ESG, standards can be higher than requirements mandated by environmental regulators.
“[Tanknology’s] clients want to ensure there’s no contamination of groundwater. They want to be good corporate citizens, and they do that by turning to Tanknology,” says James Parmelee, managing director at private equity firm Hamilton Robinson Capital Partners, which acquired a majority stake in Tanknology in September.
Since the EPA amended the Clean Water Act in 2015 to better define the scope of federal water protection, site inspections became more stringent, causing more underground structures to get flagged. According to Porter, roughly 90% of the nearly 90,000 annual site inspections that Tanknology performs have identified some form of structural deficiency that requires repair.
EPA reports show that the number of new contamination sites continues to drop, Porter says, but the company faces a workload beyond its current
capabilities.
In April, Tanknology acquired CT&T, a fuel storage tank compliance company based in Cedarburg, Wisconsin, as part of its effort to keep up with the testing needs in the industry.
According to Parmelee, Tanknology remains confident in its growth prospects. The company’s clients still require tests and inspections, even amid the COVID-19 pandemic.
As its airline and car-rental clients are pinched, Tanknology has found another opportunity for new revenue by taking over some of its clients’ environmental compliance activities.
“Our model is very scalable. We certainly believe that there’s opportunity for growth and for our managed services,” Porter says. “We’re very optimistic.”
GRAYMATTER’S ANNUAL CONFERENCE
TRANSFORM 2020
AUGUST 5 – 11 AM EST
The event is designed for professionals in all verticals who are passionate about operational technology and transforming into digital, industrial operations.
GrayMatter’s Industrial Intelligence Conference is a unique, virtual event designed for operations professionals working in manufacturing, food and beverage, oil and gas, power production, water/wastewater and other mission-critical industries. At Transform 2020, learn from leading experts about:
• Advanced Industrial Analytics
• Cybersecurity for Operational Technology
• Reimagining UX/UI
• Manufacturing Intelligence
• Machine Learning/Artificial Intelligence
• Remote Work
I am pleased to present a Q&A session we recently held with Jim Gillespie, the CEO and co-founder of GrayMatter, a leading Industrial Intelligence and Digital Transformation company. I had the pleasure of speaking with Mr. Gillespie to discuss key trends in digitization and technology adoption in manufacturing and middle market companies, including how COVID-19 has affected those trends.
Mr. Gillespie has over 30 years of experience curating technology and guiding the digital process for manufacturing companies. GrayMatter enables assets and people to become smarter, more visible, and more productive. Through co-innovating with companies in manufacturing, water/wastewater, power, and oil and gas markets, GrayMatter delivers custom-fit operational technology programs and solutions.
We would like to share some of the discussion highlights in brief:
Digital Transformation is accessible to the middle market. It has been popular with large companies for some time, but there is a misconception that Digital Transformation requires extensive IT capabilities, scale and resources. Middle market manufacturers can benefit greatly from digitization, to conceptualize their visions, or to address operational challenge.
A company can test forms of digitization through the concept of a Proof Point, which is a small proof of concept project that demonstrates tangible business outcomes using initial intelligence developed between GrayMatter and a client. This is a relatively inexpensive process and companies can gain transformational intelligence to drive operational improvements through such a test.
Over the last few months in the COVID-19 environment, GrayMatter has consistently observed how important resiliency is to their client-base. Thematically, this resilience need is seen through the lens of an organization’s people, operations, and strategy, and coincides with a shift in preference for investment and with how resiliency is achieved.
Digital Transformation is a journey. A business can’t expect to “check the box” for Digital Transformation and follow a predetermined set of rules for implementation and be done with it. Executive sponsorship within an adopting organization is vital to achieve impactful change and sticking power. If you have concerns about how relevant Digital Transformation is to your business, know that your competitors are doing this and that if you want to be best in class, this is an operational enhancement to consider.