LOUISVILLE, KY (July 18, 2005) – Chrysalis Ventures, a leading source of equity capital for growth companies in the Southeast and Midwest, announced today that it has led a $4.5 million Series A preferred equity investment in RAD Electronics, Inc. Chrysalis’ co-investor in the financing was Palisade Capital Management, LLC of Fort Lee, New Jersey. Of the $4.5 million round, Chrysalis invested $3.0 million and Palisade invested $1.5 million. The company used the funds to purchase the assets of Astrex, Inc., a value added electronics distributor.
RAD Electronics is an outsource provider of electronics manufacturing services, and has two operating divisions. RAD Technologies specializes in the contract manufacturing of complex printed circuit boards, custom and molded cable assemblies, and over molded embedded electronics. RAD Mil–Aero is a specialty value-added distributor of electronic connectors to the military and aerospace industries.
The newly acquired company, Astrex, Inc., is a value added electronic component distributor serving a worldwide OEM and reseller customer base, and will be merged with RAD Mil-Aero. This acquisition of Astrex follows closely the company’s acquisition in May of Arrow Electronics’ Cable Assembly business unit, a major supplier of custom cable assemblies and associated contract manufacturing services, which significantly increased the capacity of RAD Technologies contract manufacturing capabilities. RAD Electronics now has operations in Los Angeles, Boston, New York, Portland, and Mexico.
RAD is managed by two well-known industry veterans: William C. Cacciatore, Chairman, the former CEO and Chairman of Richey Electronics; and Charles W. Mann, Chief Executive Officer, the former Vice President of Value Added Services at Richey Electronics.
“Aggressive expansion is planned for both operating divisions,” said Mr. Mann. “We are pleased with these two back to back acquisitions: not only are they consistent with our strategic vision but they strengthen each of our operating divisions. RAD Electronics is now a formidable player in contract manufacturing services as well as in the distribution of value added interconnect electronic components. We see substantial cross selling opportunities to our mix of OEM, contract manufacturer, and reseller customers. We continue to serve large, medium, and small accounts alike, with a concentration in smaller and mid sized customers. RAD expects 2006 sales of this newly expanded enterprise to exceed $100 million.”
According to William Cacciatore, RAD Chairman, “We are pleased to partner with Chrysalis Ventures and Palisade Capital Management for this important growth financing. Chrysalis and Palisade both bring valuable insight as well as capital depth to the company. This A round of funding allows us to expand our products and services to the military, commercial electronics, and aerospace industries. We expect to grow RAD into a very large enterprise over the next several years.”
“We have been very impressed with this experienced management team who we have known for several years.” said Bob Saunders, Chrysalis Managing Director. “While this investment is outside our core geographic focus, we have had a relationship with Bill Cacciatore and Chuck Mann for over a decade and have great confidence in their leadership abilities. The company’s state-of-the-art equipment and modern production capability, combined with seasoned management, make it well positioned to serve the needs of the commercial, military, and aerospace electronics marketplace.”
Sergey Dubin, Vice President of Palisade Capital Management, added, “We invested very successfully in Bill Cacciatore’s prior venture, Richey Electronics, as a public company and know the management team well. We are delighted to partner with Chrysalis in this new investment.”
Mr. Saunders and Mr. Dubin have joined RAD’s Board of Directors.
About Chrysalis Ventures
Founded in 1993, Chrysalis Ventures is a leading source of equity capital for young growth companies in the Southeast and Midwest. Chrysalis invests primarily in early-stage and expansion-stage companies in healthcare information technology and services, media and communications, and business services. Based in Louisville, Kentucky, Chrysalis has more than $200 million under management and has made investments in over 45 companies. For more information, please visit www.chrysalisventures.com.
About Palisade Capital Management
Palisade Capital Management, LLC is a Registered Investment Advisor based in Fort Lee, NJ. Established in 1995, Palisade provides specialized services to private limited partnerships, equity and convertible portfolios, and high net worth individuals. For more information, please visit www.palisadecapital.com.