Case Studies - Calyx Transportation Group, Inc.
Third Party Logistics and Transportation Services
Providing the Tools for Management Success
Wynnchurch's partnership with the management of Calyx Transportation Group, Inc. has been a win-win relationship. Wynnchurch partner Charles Grace, who serves on the Calyx board of directors, describes our contribution this way: "Wynnchurch added the strategic resources and capital, enabling the Calyx team to take full advantage of the company's strengths."
As one of Canada's leading providers of logistics and transportation services, Calyx had doubled in size before Wynnchurch purchased a majority interest in May 2006, via a recapitalization in partnership with Calyx's management team. Senior debt financing was arranged by BMO Nesbitt Burns with a syndicate of lenders that includes Bank of Montreal, The Bank of Nova Scotia and GE Capital, while McKenna Gale Capital provided subordinated debt financing for the transaction.
With revenues of $250 million, Calyx was enjoying rapid growth in revenues and profits. "Calyx is really a new company that formed the umbrella for five different business units, each with its own competitive advantages in the logistics industry," Mr. Grace observes. The company is a unique blend of asset intensive, asset light and non-asset based services, which include: domestic intermodal freight forwarding, international air and ocean freight forwarding, dedicated and core carrier transportation, specialized less-than-truckload (LTL) transportation, truckload transportation (TL) and value-added warehousing services.
The majority owner of Calyx at the time of our investment was seeking to step back from his day to day activities at the company. Upon his retirement, 15-year company veteran Rob Donaghey assumed the CEO position with our full support. "At Wynnchurch we view ourselves as being in the people selection business," declares Mr. Grace, "and our firm has backed Mr. Donaghey's management team with our full financial support. Our goal is to help Calyx realize its full potential through a leveraged recapitalization structure that will provide the management team with significant economic incentives."
With our experience in the Canadian logistics industry, Wynnchurch is well positioned to help Calyx expand in the transportation marketplace. Our definition of being an investor is to be a true partner with management, and our firm's role in Calyx is to provide the tools, counsel and capital to support management in achieving their vision.