Seven Mile Capital Partners buys Tennessee-based Microporous
New York-based private equity firm Seven Mile Capital Partners has bought Microporous, considered as one of the oldest business operations in Northeast Tennessee, the news website TriCities.com reported. Formerly called Amerace, Microporous was established in 1934. It makes rubber-based products that are utilized in lead acid batteries which, in turn, are sold to firms that make batteries for various purposes like cars, golf carts and others, the report said.
Microporous Vice President of Sales Steve McDonald has served the battery parts supplier since the 1990s and has witnessed it change ownership hands through the years. One of the more controversial deals was when a Polypore division bought Microporous in 2008 and in the process brought down the battery parts suppliers from three to two. This ultimately led to the filing of a complaint with the Federal Trade Commission which resulted to a 2010 ruling that declared the acquisition led to a monopoly.
Microporous President and Chief Executive Officer Jean-Luc Koch told TriCities, "They found that the real motivation for Polypore to acquire Microporous was to control the market, to control price. It was pretty clear from the start that divestiture would be made, but Polypore has used all the possible legal tricks to lengthen the process."
Although Polypore appealed, the Supreme Court did not anymore want to hear the case and in August, Polypore was given by the FTC six months to divest the company, the report said citing public records.
Seven Mile Capital Partners expressed interest in acquiring Microporous and called on Koch, who previously worked for Polypore, to help the private equity company during the transition. When the sale was closed in December, he was assigned to lead the company.
Koch said that while they will continue to remain in the lead acid battery market, they are also thinking of coming up with new products. They also plan to grow their sales in the US and European markets and potentially expand in Asia, the report said.