American Capital Strategies Ltd. has bought a majority stake in engineered nonwoven products firm DelStar Technologies Inc.
American Capital invested $114 million to acquire an 83 percent stake in DelStar, the firms announced Dec. 6. American Capital of Bethesda, Md., invested in senior term loans, senior subordinated debt and equity. American Capital is a publicly traded buyout and mezzanine fund.
DelStar's product lines include Naltex biplanar extruded netting, Delnet apertured films, Coretec extruded cores and precision parts, DelPore melt-blown media and Stratex engineered composites. The Middletown, Del., company's major markets are filtration, breathable and protective fabrics for health-care, and industrial applications such as heating, venting and air conditioning products, automotive goods and food packaging. It has production plants in Austin, Texas; Richland, Pa.; El Cajon, Calif.; and Suzhou, China.
The investment by American Capital will help DelStar ``look at opportunities we couldn't look at in the past,'' DelStar Chief Executive Officer Mark Abrahams said in an interview.
The investment will advance DelStar's product line, expand its customer base, boost sales and strengthen DelStar's foreign presence with the recent opening of its plant in Suzhou, Abrahams explained. DelStar management and employees will continue to hold an equity stake in the company.
American Capital acquired its stake from various investors, including former majority owner RFE Investment Partners of New Canaan, Conn.
RFE officials were not available to confirm a report that RFE more than quadrupled its original investment in DelStar when it sold its stake to American Capital.
Harris Williams & Co.'s Boston office advised on the Dec. 2 transaction.