KW International to build new manufacturing facility with growth equity from OFS Energy Fund

OFS Energy Fund

OFS Energy Fund has closed on a growth equity investment in Houston, TX-based KW International LLC, a provider of production and midstream equipment for oil and gas producers. Proceeds from the investment will fund KWI’s expansion into a new manufacturing facility to be located in Columbus, Texas, by summer 2013.

“KWI has an exciting opportunity to grow our enterprise into the 150,000-square-foot facility while continuing to provide process and production equipment for oil and gas producers,” said Kurt Wind, CEO of KWI.  “We expect to add approximately 150 new jobs and see a substantial increase in the size and scope of our business."

As part of the transaction, OFS contributed growth equity for an ownership position and arranged bank credit facilities.

Ken Wind founded Ken’s Production Equipment Locators (predecessor of KWI) as a small oil and gas startup production equipment company in Houston in 1960.

From 2010 to present, KWI has increased its product offering, opened field offices in Pennsylvania and Columbus, and grown from 84 to 151 employees.

“We look forward to assisting the company with its continued growth as it capitalizes on the high demand for equipment and related infrastructure in the Permian Basin and the Eagle Ford shale as well as other emerging shale plays,” said Bruce Ross, managing partner of OFS.

KWI’s products are geared toward gas and liquids production, processing and transmission. Ross pointed out that capital spending on process equipment and other natural gas (and liquids) infrastructure in the US is increasing, and that the largest share of these infrastructure costs are expected to be in the southern United States.

Joining OFS on KWI’s board of directors will be Andy Smith, Natco’s former CFO. Natco, which was the largest U.S. manufacturer of process equipment, was sold to Cameron for approximately $1 billion in 2009.

Amegy Bank of Texas provided financing for the transaction.

Houston-based OFS Energy Fund is a professionally managed private equity firm that specializes in acquiring and recapitalizing lower middle-market energy service companies.

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