Information on the Target

AWP Safety ("AWP"), founded in 1993 and headquartered in North Canton, Ohio, is recognized as one of North America's leading providers of traffic management services. The Company plays a pivotal role in supporting utility, broadband, and transportation infrastructure projects across the U.S. By specializing in directing traffic safety around work zones, AWP ensures the safety of workers and the public during critical infrastructure activities. In addition to its traffic management capabilities, AWP also offers consultation and traffic design services, along with a variety of traffic control equipment. AWP is currently majority-owned by Kohlberg & Company, a private equity firm based in Mount Kisco, New York.

Industry Overview

The traffic management industry in the United States is a crucial segment supporting the growing demand for infrastructure improvements and enhancements. With increasing investments from both public and private sectors in transportation and utility projects, the need for effective traffic management services is more pronounced than ever. State and local governments are recognizing the importance of traffic safety measures to ensure smooth workflow and minimize disruption during construction or maintenance activities.

Moreover, the rise of urbanization and infrastructure modernization underscores the importance of reliable traffic control services. The surge in broadband expansion and renewable energy projects has further stimulated growth in this sector, presenting significant opportunities for companies like AWP to expand their services. Amidst these trends, traffic management service providers face mounting pressure to innovate and enhance service efficiency in an increasingly competitive landscape.

In Ohio, where AWP is based, the state's government has committed substantial resources to improving highways and bridges, further bolstering demand for comprehensive traffic management solutions. With a robust network of local authorities focused on infrastructure reliability, AWP is ideally positioned to benefit from these initiatives as it continues to expand its service capabilities.

The Rationale Behind the Deal

The investment by Gryphon Investors through its Junior Capital Fund is aimed at supporting AWP Safety in its growth trajectory and expanding its operational capabilities within the traffic management sector. This strategic move aligns with Gryphon's focus on middle-market companies that demonstrate strong fundamental growth opportunities and a competitive edge in their respective industries. By infusing capital into AWP, Gryphon aims to enhance its service offerings and facilitate potential acquisitions to strengthen its market position.

Information About the Investor

Gryphon Investors is a prominent middle-market private investment firm that specializes in growing companies within a variety of sectors, including Business Services, Technology Solutions, and Healthcare. With over $9 billion in assets under management, Gryphon applies a hands-on approach to investment, partnering with company founders and executives to drive growth and create long-lasting value. The firm's unique investment strategies encompass equity and junior capital investments tailored for private equity-owned firms, ensuring flexibility and support for growth initiatives.

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This deal carries significant potential for AWP Safety, given its strategic alignment with Gryphon Investors' experience in enhancing the capabilities of middle-market companies. The infusion of capital from Gryphon's Junior Capital Fund is likely to bolster AWP’s ability to innovate and expand its service offerings, which is crucial in a market characterized by rapid change and evolving demands.

The traffic management industry is currently witnessing growth driven by increased infrastructure spending, positioning AWP favorably to capitalize on emerging opportunities. Gryphon’s expertise in operational management is a valuable asset that will likely enhance AWP's operational efficiency and market competitiveness.

Overall, this investment is expected to be mutually beneficial. For AWP, it provides an opportunity for substantial growth, while Gryphon Investors stands to gain from investing in a company that is strategically important in a lucrative sector. Therefore, this transaction is viewed favorably, with strong potential for future success.

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