Target Information

Argosy Private Equity has successfully exited its investment in Component Sourcing International (CSI), a leading Supply-Chain-as-a-Service provider founded in 1982. CSI specializes in global sourcing and supply chain management, catering to a wide range of customers across industrial, equipment, and construction sectors. During Argosy's investment period, the company leveraged its proprietary Value Acceleration Methodology (VAM™), under the leadership of CEO John Hornberger, to deepen its market presence and venture into new industry verticals.

Throughout its ownership, Argosy facilitated several strategic acquisitions, including CSI in 2014, Alltech Pro, LLC in 2021, and AMIC Global in March 2022. Additionally, they implemented various initiatives to enhance the company's operations, such as staffing improvements in the Global Sourcing department, upgrading facilities, and enhancing marketing strategies. These efforts contributed to a remarkable increase, with CSI's EBITDA growing more than fivefold during Argosy's investment horizon.

Industry Overview

The supply chain management industry has shown significant growth prospects globally, with notable developments in the United States. Factors such as rising globalization, advancements in technology, and an increasing demand for efficiency in supply chain operations have spurred this growth. Companies are increasingly looking for ways to streamline their supply chains to minimize costs and enhance operational performance.

In the U.S., supply chain challenges have been heightened due to recent global disruptions, which have prompted businesses to rethink their sourcing strategies. Many organizations are now investing in technology and services that provide end-to-end visibility across their supply chains. This trend is enabling companies to better adapt to fluctuations in demand and supply, showcasing the need for innovative sourcing solutions.

Furthermore, the ongoing emphasis on sustainability and resilience is reshaping the industry landscape, with companies seeking partners who can provide strategic insights and solutions that align with these priorities. As a result, there is growing interest in supply chain management services, particularly among industries that depend heavily on efficient supply chain operations.

Rationale Behind the Deal

The sale of CSI to CPC, LLC aligns with Argosy Private Equity's strategy of creating value through active management and targeted growth initiatives. By utilizing the VAM™ framework, Argosy diversified CSI’s service offerings and solidified its position as a leader in the supply chain management sector. The exit represents a successful culmination of Argosy's commitment to transforming CSI into a world-class global sourcing organization, setting the stage for future growth under new ownership.

Moreover, the transaction provides CPC, LLC with an established platform in a dynamic market that is ripe for further expansion. By acquiring CSI, CPC can leverage its existing resources and expertise to drive growth opportunities and address the complex supply chain solutions that many businesses are currently seeking.

Investor Information

Argosy Private Equity is a well-regarded investment firm known for its focus on medium-sized companies. With a proven track record of creating value through its VAM™ business system, Argosy emphasizes strategic planning and operational excellence to foster growth in its portfolio companies. The firm's commitment to continuous learning and management development has empowered company leaders to achieve outstanding results.

Throughout its engagement with CSI, Argosy has positioned itself as a partner dedicated to driving transformational growth. The investment firm has worked closely with the management team to implement best practices and foster a high-performance culture, which has been instrumental in CSI's impressive performance during the investment period.

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The exit of Argosy Private Equity from its investment in CSI can be viewed as a strong validation of the firm's investment strategy and execution capabilities. By successfully enhancing the company’s market position and financial performance, Argosy demonstrated its ability to deliver significant returns. The more than fivefold increase in EBITDA during the investment period is a testament to the effectiveness of the implemented initiatives and the strong leadership of CEO John Hornberger.

In the current climate, where supply chain solutions are increasingly sought after, CSI's established reputation positions it favorably for continued success. The strategic acquisition by CPC, LLC opens up new avenues for growth and enhancement of CSI's already robust capabilities in solving complex supply chain challenges.

Overall, this transaction not only represents a successful exit for Argosy Private Equity but also provides a solid foundation for CSI’s future evolution under CPC's ownership. This deal exemplifies the potential for further growth in the supply chain management industry, providing both parties with an optimistic outlook for the road ahead.

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