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Blackhawk Specialty Tools

Blackhawk

www.blackhawkst.com

Blackhawk offers proprietary wellbore construction equipment,
including cement heads and complementary cementing products.

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Blackhawk

Headquarters: Houston, Texas

Facilities in: Houston, Texas; Midland, Texas; Houma, Louisiana; Muncy, Pennsylvania.

Employees: 120

The Investment

Blackhawk was founded by Billy Brown, Dean Robichaux, Ron Robichaux and Lawrence Brown in 2008. Rock Hill Capital partnered with Blackhawk in March 2010, with an equity investment to provide growth capital to expand the company’s then sole product line, a revolutionary rotating cement head for the oil and gas industry.

During the three years of the Rock Hill investment, Blackhawk developed a host of proprietary wellbore construction equipment, including additional cement heads and complementary cementing products. Blackhawk designs, engineers, assembles, rents and sells its technologically advanced equipment for offshore and onshore use by major integrated oil and gas companies, large independent oil and gas companies, and foreign national oil and gas companies operating primarily in the United States, Gulf of Mexico and in select international markets.

Weathering the Storm

In April of 2010 the Deepwater Horizon drilling rig exploded and the Gulf of Mexico deep water drilling moratorium began. At the time of the incident, 100% of Blackhawk’s revenue were derived in the Gulf of Mexico. Rock Hill engaged with management to develop an accelerated plan to modify and deploy the cement head product line to the domestic land market. By June of 2010 the company was operating in the Marcellus Shale in Pennsylvania and shortly thereafter entered the South Texas market. The Blackhawk product line enjoyed great success in the land markets and provided diversification and great growth prospects. During this time Blackhawk earned a reputation as an innovator and developed products that provided enhanced productivity to the drilling industry. Ultimately, in the fall of 2011 the Gulf of Mexico drilling moratorium effectively ended and Blackhawk emerged as a diversified growth oriented leader in the industry.

Addressing the Needs of the Industry

Blackhawk, through its investment in R&D – including a new facility in Houston opened in March 2011 –introduced significant, game-changing cementation products to the oilfield. With the opening of its Houma, Louisiana manufacturing plant in November 2012, Blackhawk was able to begin shipping its new proprietary tight tolerance bow spring centralizers to both the land and offshore markets.

Cemented Success

Throughout the life of the investment, Rock Hill and management developed a strategy of growth, product line expansion and development of new markets with significant growth potential. We believed this strategy would result in an attractive acquisition opportunity for both strategic buyers along with larger private equity firms. In August of 2013, Rock Hill was able to realize its investment in Blackhawk by finalizing the sale of its ownership position to Bain Capital, LLC and Blackhawk management. During the three years of the partnership, Blackhawk was able to grow from annual revenues of approximately $8.0 million at 2009 year end to annual revenues of $68.3 million in 2013.

“We are pleased to have had the opportunity to work with the Blackhawk team and its CEO Billy Brown through an exciting and dynamic growth period for the company,” said Randall Hale, founder and managing director of Rock Hill. “We enjoyed our relationship with the Blackhawk team and could not have asked for better partners. We wish them continued success.”

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CCS Presentation Systems

Integrated A/V (dba CCS Presentation Systems)

www.ccsprojects.com

Provider of integrated audio video products, services and solutions.

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Offices: Houston, Dallas, Austin, San Antonio, Tyler, New Orleans

CEO: Mark Kalinsky

The Investment

CCS provided complete audio video products and solutions, from simple accessories to multi-million dollar integration projects, to board rooms, school classrooms and world-class resorts.

CCS divided its business between corporate, education and government clients.

Diversification Helps Integrated A/V Expand During Recession

Rock Hill Capital invested in Integrated A/V in 2008, attracted by the company’s solid balance sheet, CEO and management team. The company had diversified into the education and government markets and was able to thrive during the recession when corporations cut back spending.

“It allowed me to take some personal risk out of the business and take some cash out of the business,” Mark Kalinsky, CEO, told the Houston Business Journal of Rock Hill’s investment. “It allowed me…to have a strong investment partner who helped me grow the company. Once you bring in a financial investor, your level of sophistication as a business improves.”

After closing on the Integrated A/V transaction, Rock Hill initiated a number of steps to further strengthen the management team and develop a platform for continued growth. Some of those include:

  • Helping Integrated A/V recruit and hire a seasoned CFO who installed and implemented accounting and CRM (contact relationship management) systems. He also became an integral part of the day-to-day operational management:
  • Evaluating and modifying the company's sales compensation systems to reward higher margin sales;
  • Introducing the company to key service providers who in turn reduced insurance and bonding costs;
  • Assisting in the evaluation, negotiation and structuring of company acquisitions.

Presentations Now Show on a National Stage

At the time of Rock Hill’s investment, Integrated A/V was generating revenues of $37 million through its six offices. Subsequent to its investment, Integrated A/V completed the acquisition of Creative Presentation Systems in October 2009, which expanded its geographic footprint to Louisiana.

In 2010, Integrated A/V sold to Troxell Communications, Inc. and AEA Investors, L.P., a New York based private equity fund. During Rock Hill’s stewardship, Integrated A/V expanded into new markets and grew revenues by 56%, to complete 2010 with $58 million in revenue.

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CaseStudy-Southwaste

SouthWaste Services, LLC

www.southwaste.com

Non-hazardous liquid waste collection, processing and disposal
services.

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Headquarters: Houston, Texas

Facilities in: Houston, Dallas, Ft. Worth, San Antonio, Lubbock, Austin and Orlando, Florida

Employees: 120

The Investment

SouthWaste Services provides non-hazardous liquid waste collection, processing and disposal services. Typical wastes handled by SouthWaste include grease, grit, wastewater, sewage, sludge and leachate for customers such as restaurants and school cafeterias.

The company was founded in 2005 by a group of private investors, with the goal to consolidate the regional liquid waste market through the acquisition of several local Texas players. In 2009, the company looked to Rock Hill for additional capital and M&A experience in order to continue SouthWaste's growth.

Rock Hill Capital purchased a majority ownership in 2009, and as is typical with Rock Hill investments, SouthWaste’s CEO and some existing shareholders also invested in the company’s future.

Making Waste Pay

With Rock Hill’s guidance, SouthWaste embarked on several strategic initiatives that strengthened the company and improved its financial results. A few of those were:

  • Developed a sales force focused on improving customer retention and garnering new business
  • Helped the company select a CFO who would establish key financial metrics and management reports to support the company’s performance
  • Assisted in the evaluation, negotiation and structuring of the company’s Florida acquisition and the sale of its operations in Atlanta
  • Helped the company evaluate and select a truck routing system that improved efficiencies and lowered costs
  • Worked with the SouthWaste board of directors to add management capabilities

Growth Through Innovation

Collecting the fats, oils and grease (known as FOG) in the typical grease trap may be the backbone of its business, but SouthWaste continues to look for innovations to its business model. That is why SouthWaste implemented a new process in its facilities that significantly reduced hauling disposal costs by creating a new revenue stream.

The new process converts grease trap waste into refined brown grease that can be blended with bunker fuel or yellow grease. This product is used to increase yields in the production of bio-diesel. The new process was then rolled out to all SouthWaste locations.

Meanwhile, SouthWaste continues to gain market share and improve operational efficiencies.

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CaseStudy-Tideland Signal Corporation

Tideland Signal Corporation

www.tidelandsignal.com

Deliverer of world leading Aids to Navigation solutions, products, services and customer care.

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Headquarters: Houston, Texas

Offices: Canada, Singapore, UAE, United Kingdom, USA

Production capability: Asia, Europe, Middle East, North America, South America

Employees: 107

The Investment

Tideland is the world’s leading manufacturer of marine Aids to Navigation. Since its founding in 1954, Tideland has built a reputation for developing equipment to high performance specifications with the reliability needed to withstand harsh marine conditions. Tideland is prominent in ports and harbors as well as offshore operations around the world, and provides specialized Aids to Navigation equipment to the offshore oil and gas industry.

One of Many Firsts

Tideland leads the industry in many firsts, with innovation throughout the company’s history.  In the early 60’s, they developed a 300mm lens for the offshore industry, which even today leads in efficiency.  During the 70’s, Tideland branched out and developed strong competency in solar and offshore power.  As radar technology developed, the company introduced the first Racon (radar beacon) in the 80’s.  Most recently, Tideland released a Racon with an Automatic Identification System, which has a patent pending.  The continuing development of technology solutions by Tideland in the ports, harbors and offshore industries has led to the granting of over 50 patents for aids to marine navigation.

When Tideland sought its first outside funding to fuel its growth in 2012, Rock Hill Capital proved itself a good fit. Rock Hill immediately went to work helping Tideland add management capabilities.

Lighting the Path to Greater Margins

A strategic review by senior management uncovered opportunities to expand outside its traditional lines of business. Management also identified and implemented a number of initiatives to strengthen the company's systems and operating infrastructure, improve inventory management, extend its go-to market footprint, and grow overall margins.  As Tideland continues to expand, Rock Hill remains by its side to further nurture this global supplier of world-leading Aids to Navigation solutions, products and services.

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