February 2011
ROCHESTER, N.Y., February 11, 2011 - BioMaxx Inc. (BioMaxx), a portfolio company of DeltaPoint Capital IV, L.P. (DeltaPoint IV), has acquired Dry Creek Products, Inc. (Dry Creek), an Arcade, NY-based manufacturer of premium biomass wood pellets, marking the company's second acquisition in the biomass wood pellet space in the last seven months. BioMaxx has established its headquarters in Wellsville, NY to properly manage the company's significant operations in Ulysses, PA and Arcade, NY.
DeltaPoint made its initial investment in BioMaxx in July 2010, forming a holding company to acquire PA Pellets, Inc., Choice Forest Products, Inc., and two other related entities, collectively a forestry business and premium biomass wood pellet producer. Immediately after the initial acquisition, the company began executing a strategy to pursue strategic acquisitions throughout the Northeast, focusing on well-respected companies with strong brands and high quality products. This acquisition gives BioMaxx the capacity to produce more than 120,000 tons of wood pellets on a yearly basis, positioning it among the largest wood pellet manufacturers in the Northeast.
The New York State Common Retirement Fund invested $3.2 million in BioMaxx to help facilitate the acquisition and move the company's headquarters to Wyoming County, New York. The Common Retirement Fund made the investment through its In-state Private Equity Program.
"BioMaxx is a perfect example of how we can do well for the members of the Retirement System while doing good for New York businesses and the environment," DiNapoli said. "Biomass applications create clean and renewable energy that reduces our independence on foreign oil. This is a great investment for the pension fund, and a good step toward making New York and the country less dependent on fossil fuels."
George (Geff) F.T. Yancey is a Rochester native who serves as BioMaxx's President and is an Operating Director of DeltaPoint IV. Mr. Yancey joined BioMaxx to assist the company in formulating and executing its long-term growth strategies. "The Dry Creek acquisition helps further establish BioMaxx as a leader in one of the only true clean-tech industries. We are producing a product that is environmentally friendly and competes directly with fossil fuels. This is not a product in development; wood pellets compete with fossil fuels right now," Yancey said.
Established in Arcade, NY in 1992, Dry Creek is one of the most well-respected brands in the wood pellet industry. Beloved by its customers for its long track record of extremely high quality products and customer service, the Dry Creek name represents a symbol of quality and consistency. Greg Palmer, founder of Dry Creek Products, Inc., is confident BioMaxx's acquisition of Dry Creek will be extremely beneficial for retail customers and end users of Dry Creek's pellets. "This acquisition ultimately provides us with the ability to properly serve our customers. The wood pellet industry is constantly changing and we feel our partnership with BioMaxx provides our customers with the ability to always get the high quality Dry Creek pellets they want and need," Palmer said.
BioMaxx, Inc. reached an agreement to establish its corporate headquarters in Wellsville, NY. Wellsville is strategically located between BioMaxx's two manufacturing sites, enabling management, customers and suppliers to easily access all three locations. The acquisition of Dry Creek and establishment of a New York headquarters further illustrate the company's commitment to doing business in New York state and providing the state's residents with a clean, renewable source of energy. The company has also joined the Biomass Thermal Energy Council, an association of biomass fuel producers, appliance manufacturers and distributors, supply chain companies and non-profit organizations that view biomass thermal energy as a renewable, responsible, clean and energy-efficient pathway to meeting America's energy needs. BTEC engages in research, education and public advocacy for the fast-growing biomass thermal energy industry.
Jason Holmberg, BioMaxx's Executive Vice President, feels the benefits of this acquisition are far reaching and will benefit PA Pellets customers, Dry Creek customers and the biomass wood products market at large. "BioMaxx remains committed to executing on its strategic plan of acquisition and cultivation of other strategic partnerships. Owners and managers of other biomass wood pellet operations can benefit greatly by joining the BioMaxx platform or establishing strategic partnerships with the company, as BioMaxx has the breadth and reach of significant available capital and operational knowledge," Holmberg said.
DeltaPoint focuses on investing in established businesses with annual revenue of at least $10 million in the manufacturing, distribution and specialized service sectors. The Dry Creek acquisition is the second investment DeltaPoint has made from its fourth fund, which held its initial close in November of 2009 and continues to raise funds towards its $125 million goal.
David Waterman is a Managing Director at DeltaPoint and serves as BioMaxx's Chairman of the Board. "Our strategy is to invest in proven private companies that are changing hands. That strategy manifests itself in the BioMaxx investment, as we are helping a well-established private company grow through a change of control transaction. We expect BioMaxx to grow significantly through further acquisition, strategic partnerships and organic growth initiatives. We are very excited about this investment," Waterman said.