MiddleGround Capital Announces Acquisition of Megatech

MiddleGround Capital, an operationally focused private equity firm that makes control investments in North American middle market B2B industrial and specialty distribution companies, today announced it has acquired Megatech (the “Company”), a new digital manufacturing platform investment focused on computerized numerical control (“CNC”) machining of highly-complex, highly-precise, low volume engineered parts.

Founded in 1992 and headquartered in Québec City, Québec, Megatech has become a leader in the machining industry, distinguishing itself by its exceptional quality and precision. The Company leverages simulation, 3D visualization, analytics, and collaboration tools to produce a wide variety of products for over 100 customers utilizing its modern fleet of state-of-the-art equipment. Megatech’s customer base spans across numerous end markets including optics & photonics, robotics, non-destructive testing, medical, and A&D, among others. Supported by an efficient Material Requirements Planning (“MRP”) system and by a team of trusted partners and subcontractors, Megatech is able to offer customers quick turnaround times for orders.

“In a world in constant acceleration, Megatech’s mission is to be a leading machining shop, specialized in high precision and complex parts,” said Jean Blanchet, CEO of Megatech. “We’re excited to work with the MiddleGround team to achieve our next leg of growth through organic and inorganic strategies, while continuing to maintain the qualities that have resulted in our success thus far. Our growth to date can be attributed to our employees, equipment, processes and engineering capability along with our ability to provide highly-technical and complex machining capabilities with fast turnaround times.”

MiddleGround will look to leverage its resources and expertise to organically and inorganically build a larger platform around Megatech focused on highly-specialized, complex, low-to-medium volume prototyping and production parts in the outsourced manufacturing space with strong revenue tailwinds driven by Industry 4.0 trends.

“With a track record of long-term growth, we look forward to supporting and accelerating Megatech’s growth strategy,” said Marty Sjoquist, Director, Investment Team at MiddleGround. “We are excited to work closely with Megatech’s experienced team to build a scaled and diversified platform, expanding the Company’s technological and manufacturing capabilities and aligning it with the tailwinds of Industry 4.0 manufacturing. Our Operations Team will help to ensure that Megatech has the tools to meet increased demand, including considering re-configuring existing facility footprints, optimizing machine utilization, adding new machines in the facility’s whitespace, and evaluating opportunities to benefit from advancements in procurement.”

Stifel acted as exclusive financial advisor to Megatech in its sale to MiddleGround Capital.

About Megatech

Founded in Quebec City in 1992, Megatech is a leader in the machining industry, distinguishing itself from its competitors with exceptional quality and precision. Success is attributable to the Company’s employees, equipment, processes, and engineering capability along with a superb MRP system. Supported by the latest technology and by a team of trusted partners and subcontractors, Megatech’s mission is to be the best machining shop in Canada, specialized in high precision and complex parts. For more information, please visit: https://www.megatechaq.com/en/home/.

About MiddleGround Capital

MiddleGround Capital is a private equity firm based in Lexington, KY with over $3.3 billion of Assets Under Management. MiddleGround makes control equity investments in middle market B2B industrial and specialty distribution businesses. MiddleGround works with its portfolio companies to create value through a hands-on operational approach and partners with its management teams to support long-term growth strategies. For more information, please visit: www.middlegroundcapital.com.

Contacts

MiddleGround Capital Media Contacts

Doug Allen/Maya Hanowitz

Dukas Linden Public Relations

MiddleGround@dlpr.com

+1 (646) 722-6530

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