A uxo Investment Partners’ acquisition of a West Michigan manufacturer has both in-state and national growth opportunities for the Grand Rapids private equity firm.

Auxo’s deal for Cascade Township–based Tack Electronics Inc. represents more investment potential for the Michigan Opportunity Fund, a $100 million fund led by Auxo executives and several prominent figures in the state’s business community that aims to invest in and grow Michigan-based companies.

Meanwhile, Tack Electronics also bolsters Auxo’s growing wire harness platform, a niche portfolio of three companies in California and Michigan specializing in wire harness manufacturing.

“We think this has the potential to be a very, very sizable platform,” said Auxo Investment Partners co-founder and Managing Partner Jeff Helminski. Manufacturing Auxo Investment Partners/Tack Electronics Inc. Business description: Cascade Township-based manufacturer of custom wire harnesses, cable assemblies and box builds that sold to Auxo Investment Partners, a Grand Rapids-based private equity firm Annual sales: Did not disclose Top executive: Jeff Helminski, co-founder and managing partner of Auxo; Todd Maines, CEO of Tack Electronics Total Michigan employees: Approximately 100 Advisers: Foster, Swift, Collins & Smith PC (legal) and Dolinka Van Noord & Co. (financial) for Tack Electronics; Miller Johnson and Barnes & Thornburg LLP (legal), BDO USA LLP (accounting), Mercantile Bank of Michigan (banking)

Business description: Cascade Township-based manufacturer of custom wire harnesses, cable assemblies and box builds that sold to Auxo Investment Partners, a Grand Rapids-based private equity firm

Annual sales: Did not disclose

Top executive: Jeff Helminski, co-founder and managing partner of Auxo; Todd Maines, CEO of Tack Electronics

Advisers: Foster, Swift, Collins & Smith PC (legal) and Dolinka Van Noord & Co. (financial) for Tack Electronics; Miller Johnson and Barnes & Thornburg LLP (legal), BDO USA LLP (accounting), Mercantile Bank of Michigan (banking)

The Tack deal dates back to early 2021 discussions between Helminski and Tack CEO Todd Maines, who knew each other as members of the Young Presidents’ Organization. Soon after, though, another potential buyer approached Maines with a “price that was higher than what we were comfortable paying,” Helminski said.

When plans with the other buyer fizzled out, Maines approached Helminski to see if Auxo was still interested in a deal.

“Of course, we were. That led to us rekindling that conversation and ultimately getting the deal done together,” Helminski said.

The strategic acquisition earned Auxo a 2023 MiBiz M&A Deal of the Year Award in the manufacturing category.

Maines’ parents founded Tack in 1996 in a two-stall garage to serve customers whose needs fell outside of traditional contract manufacturing operations. The family-owned Tack specializes in wire harnesses and cable assemblies. 

“Think of it as the electrical nervous system of your car, a battery system, a food truck, television or airplane,” Helminski said. “They tend to be bundled up and there’s a spine and other components that come off of it that need electrical power of various sorts.”

Maines purchased the company from his parents 10 years ago and, in selling, “wanted to keep the family legacy going.” The company experienced “exponential growth” in the past couple of years, which created an ideal time for bringing on a partner to help expand, he said.

Maines said the connection to and investment backing from the Michigan Opportunity Fund, as well as the chance to join a growing platform of companies, made the deal with Auxo appealing.

“Being part of a larger platform has allowed us to have more resources and capital, and more opportunities for our employees to grow and develop and be a better supplier for our current customers and new customers,” Maines said. “It just seemed like a good fit for us.”

The integration process has been “a success so far,” added Maines, who will stay on to lead the company as CEO.

Tack represents the third acquisition for Auxo’s wire harness platform. In March 2022, Auxo announced the acquisition of Fremont, Calif.-based Golden State Assembly Inc., followed by Morgan Royce Industries, also based in Fremont, Calif. Combined, the three companies serve a mix of high-tech industries, including the electric vehicle, aerospace and medical device sectors.

The platform is currently based in the Bay Area with the collectively larger GSA and Morgan Royce Industries, although Tack “has some capabilities that we think will lead to some rapid growth here as well,” Helminski said. 

“At the moment, (the companies are) operating relatively independently. But the goal is to integrate the businesses so that they operate more as a cohesive unit, leverage the skills and the geographic locations of both of them today,” Helminski said. “As we acquire other companies and expand our operations around the country to build this network of a number of facilities, the headquarters will probably be either in Grand Rapids or in the Bay Area, depending on how that C suite leadership evolves over time. But I expect it will be a platform that really has national reach.” 

Helminski said in early February that a fourth acquisition was under contract to grow the wire harness platform.

“It’s an area where we think there’s a lot of potential,” he said.

MiBiz Editor Joe Boomgaard contributed to this report. 

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