L Squared Capital Partners (“L Squared”) has successfully sold its
equity interests in Virtium (the “Company”) to Court Square Capital
Partners (“Court Square”). The sale of Virtium represents the third exit
for L Squared in the last twelve months. Founded in 1997 and based in
Rancho Santa Margarita, CA, Virtium is a leading solutions provider of
customized, ruggedized, and highly engineered industrial grade embedded
solid state drive (“SSD”) and memory products. Virtium’s intelligent
networked storage, SSD and memory solutions provide the robust
performance, reliability and functionality needed in the most critical
industrial IoT (“IIoT”) applications.
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L Squared is a private equity firm headquartered in Newport Beach, CA. (Photo: Business Wire)
L Squared completed its investment in Virtium in July 2015 and saw
organic revenue more than double and EBITDA nearly triple. This strong
financial performance allowed the Company to complete two dividend
recaps in November 2016 and March 2019 returning an amount greater than
all invested capital. Since 2015, the Company made significant
investments in its global sales organization, launched several new
innovative products, and continued expanding software development and
application engineering teams to support a solution-driven customer
experience. Specifically, Virtium launched a value-added IIoT software
suite to help capture the large market opportunity of network connected
storage. Virtium’s IIoT software lowers cloud costs, shortens product
deployment cycles, simplifies service and management and enhances
security of IIoT-generated data.
“We are very happy with our partnership with L Squared over the last
four years,” said Phu Hoang, co-founder, CEO, and Board Member of
Virtium. “The L Squared team supported our vision to grow the Company
through both access to capital and strategic resources. Additionally,
they helped us recruit top level management talent and assemble a highly
productive Board of Directors. The Virtium team looks forward to
continued growth with our new partners at Court Square.”
Virtium was L Squared’s second platform investment and third exit for
the firm in the last twelve months. “From our first meeting with Phu we
understood that he was a unique and highly skilled leader. Phu and his
business partner Chinh each have inspiring personal stories dating back
to their humble roots in their native Vietnam and have proven to be
outstanding business leaders. Both have overcome incredible obstacles at
each phase of life on their way to founding Virtium and building it into
the successful company it is today,” said Sean Barrette, partner at L
Squared and Virtium Board Member. “Partnering with world class operators
like Phu and Chinh proved to be a winning formula for all stakeholders.
We look forward to watching the Company’s continued success and believe
Court Square will be an excellent partner for Virtium,” said Barrette.
L Squared and the Company were advised on the transaction by Moelis &
Company, Vedder Price P.C., and BDO USA, LLP.
About Virtium
Virtium is a leading solutions provider of industrial-grade memory and
storage solutions for the world’s top OEMs. For nearly two decades, it
has designed and built its products in the USA, fortified by a network
of global sales and support locations. Virtium’s world-class technology
and customer support result in better industrial embedded solutions for
an interconnected world. For more information on Virtium, please visit www.virtium.com.
About L Squared Capital Partners
L Squared Capital Partners is an investment firm with offices in Newport
Beach, CA, and Chicago, IL, that seeks to make long-term investments in
leading growth companies that operate in targeted sectors: Tech-Enabled
Services & Software, Industrial Technology & Services, and Education
Technology. Our unique investor base of family offices enables us to
focus on long-term value creation driven by revenue and earnings growth,
not financial engineering or market timing. The principals of L Squared
have worked together for over a decade and have over 60 years of
combined experience investing in growing private companies. For
additional information, please visit www.lsquaredcap.com.
About Court Square Capital Partners
Court Square is a middle market private equity firm with one of the most
experienced investment teams in the industry. Since 1979, the team has
completed over 225 investments, including several landmark transactions,
and has developed numerous businesses into leaders in their respective
markets. Court Square invests in companies that have compelling growth
potential within the business services, general industrial, healthcare,
and technology and telecommunications sectors. The firm has $6.2 billion
of assets under management and is based in New York, N.Y. For more
information on Court Square, please visit www.courtsquare.com.
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