Creating Standalone Business Infrastructures

At the time of our investment, IEP consisted of three legacy brands— Fenwal, Kidde, and Incom—which have been sold in the U.S. and Europe since the 1950s. These brands comprised five separate businesses owned by United Technologies Corp. (“UTC”) that had not been integrated into one unified company. UTC decided to divest IEP as a noncore asset, but IEP could not stand alone as a business because it relied on UTC for its operations, finance, IT, insurance, and benefits. To function independently, IEP needed to:

• Relocate out of UTC facilities in three countries
• Install a completely new IT infrastructure
• Hire 15+ personnel, including a CFO and head of marketing and business development
• Establish standalone insurance, benefits, and payroll programs

Also, as part of the transaction, UTC planned to retain the Fenwal and Kidde brands, which meant that a new brand would be needed. Importantly, all of this needed to be accomplished without disrupting IEP and its global customer base.

• To acquire the global leader in a growing industrial niche with a favorable outlook, driven by increasing regulation and stronger enforcement
• To create a new platform with scalable infrastructure specifically designed to support IEP’s worldwide operations and growth trajectory
• To partner with IEP’s committed and highly experienced senior management team

Smooth Transition to a Fully Standalone Business: Before the closing, management and Sentinel developed a detailed plan to quickly and seamlessly transition to a standalone business. Together, we recruited a talented CFO, promoted a highly experienced manager from the U.K. to head of European operations, and recruited a chief transition officer to help manage the relocation to new facilities in the U.S., Germany, and the U.K. IEP’s management team implemented a new global IT system. We also developed and introduced the new global “IEP Technologies” brand.

Within nine months of the closing, IEP had completed this transition with almost no disruption to its business—in fact, sales and profitability increased throughout.

Following a successful transition to a standalone business, and having significantly increased revenue and profitability, IEP was sold in 2015 to HOERBIGER Group, a leading European provider of compression technology, drive technology, and hydraulics, in a highly successful transaction for Sentinel and IEP’s management team.