OpenGate sued Thermo Fisher for breach of contract, negligent and fraudulent misrepresentation, and other things. After decades of pro-corporate globalization, people numb to its effects might write off Hufcors closure as a tragic but ultimately unavoidable consequence of a deadly pandemic and economic upheaval. In 2011, OpenGate Capital acquired a Connecticut-based boxboard manufacturer from Cascades Inc. and renamed it Fusion Paperboard. OpenGate nevertheless was lured back in as a short-term lender to Darden. document.getElementById( "ak_js_1" ).setAttribute( "value", ( new Date() ).getTime() ); Thanks for contacting us. The lawsuits allege that a company or individual violated securities laws and are brought on behalf of the class. Newkirk was fully involved in the scam, prosecutors allege. That would be a hard argument to make, he said. Most of my clients are in default. for a better future. In December 2014, while their lawsuit against Thenno Fisher was pending, the OpenGate and RoundRock entitles negotiated a sale-leaseback agreement for the . OpenGate Capital, a Los Angeles firm that amassed $5 billion in revenue during its first decade in business, has run exactly that playbook in Janesville since acquiring Hufcor in 2017. His parents left their native Tehran before the Iranian Revolution and relocated to Canada, later moving with Nikou to California when he was four years old. 19, Ex. In September 2013, OpenGate acquired PennySaver for $22.5 million. 10250 Constellation Blvd Fl 30, Los Angeles, California, 90067, United States. [30][31][32], Nikou sits on the Board of YELLOW, the non-profit organization founded by Pharrell Williams. OpenGate, which Nikou started in 2005, has engaged in more than two dozen transactions. OpenGate is perhaps best known for its 2008 purchase of the print version of TV Guide for a nominal price plus assumed debt. [25] In that same year, the firm also completed six platform investments, and one add-on, all within the second fund. And employees became increasingly worried when PennySavers CEO, vice president of finance and the vice president of human resources all quit, Buckley said. Further explore our recent investment activities and quarterly reports, 2023 OpenGate Capital Management, LLC. OpenGate strategically invests in targeted sectors across five continents utilizing a diverse and experienced team with the ability to connect with business owners around the globe. Thermo Fisher, the world's largest maker of laboratory equipment and scientific instruments, agreed to acquire Life Technologies Inc LIFE.O in mid-April for more than $13 billion. OpenGate is a global private equity firm that acquires and . In court papers, the company said the trustees allegations are without merit. It came as a complete shock to the management at the dairy and the union that they were about to close, said Eileen Appelbaum, a senior economist at the Washington, D.C.-based Center for Economic and Policy Research, whose book Private Equity at Work: When Wall Street Manages Main Street devotes a chapter to the Wisconsin dairy. Coupon mailing company PennySaver USA was in default on its main operating loan for five months before it abruptly shut down on the eve of the Memorial Day weekend, something few of its roughly 680 employees knew before they were put out of work. 1 at 17.) In February, the PennySaver building on Orbiter Street in Brea was sold for $14 million, according to public records. Newkirks lawyer, Jonathan Harris, claims Newkirk is no more than a victim just one of many duped by con man Darden Jr. At least two civil suits were filed by lenders who forked over money because they thought they were lending it to Darden Sr. only to learn otherwise when it was too late. [33] In 2014, Nikou announced that he was forming a partnership with businessman Ricardo Salinas to bring Esperanza Azteca Youth Orchestra to Los Angeles through a partnership with the city's mayor, Eric Garcetti. And the firm shut down its Fusion Paperboard plant just three years after acquiring it and only a few months after entering into a, Even as hundreds of American workers have suffered from OpenGates schemes, Andrew Nikou, the OpenGate founder and CEO, has not faced any meaningful financial or social consequences for repeated business failures at the hands of his firm. OpenGate Capital raised a new fund: OpenGate Capital Partners II ($585,000,000) News Aug 20, 2019 FinSMEs OpenGate Capital Adds Mr. Damian Blazy as Principal in Operations When OpenGate bankrupted Pennysaver, a court-appointed trustee sued OpenGate for fraudulently siphoning money from the company through a variety of shady tactics: billing it for non-existent tax payments, loaning money to another OpenGate company at knockdown rates, and putting non-working OpenGate employees on its payroll. 14 at 5-6; D.I. LOS ANGELES, October 13, 2022 -- ( BUSINESS WIRE )-- OpenGate Capital, a global private equity firm, today announced that it has exited its investment in . In 2019, OpenGate acquired the German content-management platform CoreMedia. Jul. Employees who started work later arrived to find the facility locked. They have a right to do what they did as far as liquidate the company, but they dont have a right to do it in the manner they did.. Nikou has received recognition for his business achievements. OTHER FILED BY OPENGATE CAPITAL LLC ON 07/15/2015 [+] Read More [-] Read Less; 07/16/2015. [1] The firm is focused on the acquisition of lower to middle market businesses that are often privately owned, or non-core divisions of larger companies located around the world. Nikou increased OpenGate's pace of international acquisitions in the 2010s. All rights reserved. How to avoid leaving money on the table, Congressional investigators blame airlines for most flight cancellations, First Republic Bank stock plunges to record low as rescue plan proves elusive, Fed faults Silicon Valley Bank execs and itself in bank failure. Former employees of at least three former OpenGate portfolio companies have filed lawsuits or complaints alleging OpenGate or the companies it owned violated labor laws requiring businesses to notify employees 60 days before mass layoffs. And the firm shut down its Fusion Paperboard plant just three years after acquiring it and only a few months after entering into a six-year contract with the local steelworkers union. In 2012, Nikou was a recipient of The M&A Advisor's "Top 40 Under 40" award,[4] for the West Region. Earlier this year, employees at Hamilton Scientifics Wisconsin facility received notices that they would be laid off in 60 days but were then furloughed, according to an article from PE Hub, a publication that focuses on private equity companies. At their side are elected officials who know that the whole country needs tough measures to reform private equity. OpenGate closed the PennySaver on May 22 with out warning. The lawsuit was dismissed in April 2016. [27], On January 5, 2013, Golden Guernsey ceased operations without notice in an alleged violation of the State of Wisconsin's mass layoff/shutdown regulations. But there were no stocks because the elder Darden was never a part of the deal, it is alleged. After laying off all 166 workers at Hufcor's Janesville plant, OpenGate Capital drove the company . The firm first gained recognition for the acquisition of TV Guide Magazine in December 2008,[2] and the publication's turn to profitability in the first quarter of 2010.[3]. I just dont find it funny to ruin peoples lives. "Meet The Private Equity CEO Who's In Talks For His Own Reality Show," Julia La Roche, Business Insider, 8-16-2011. OpenGate Capital is talking to limited partners about launching its next flagship, which could target up to $850 million, sources told Buyouts. Headquartered in Los Angeles, California, . OpenGate Capital is a global private equity firm specializing in the acquisition and operation of businesses to create new value through operational improvements, innovation, and growth . Several lawsuits had been filed claiming OpenGate and did not follow proper protocol under the WARN Act when firing hundreds of employees from both PennySaver and Hamilton Scientific. After the Fusion facility closed in September 2014, the state launched several programs to retrain workers, Osten said. OpenGate Capital is a global private equity firm headquartered in Los Angeles, California and Paris, France that focuses on the acquisition and optimization of underperforming businesses in the lower middle market throughout North America and Europe. Too often, private equity firms like OpenGate extract cash from the companies they acquire and walk away richer, regardless of what happens to workers and communities. [1] The firm is focused on the acquisition of lower to middle market businesses that are often privately owned, or non-core divisions of larger companies located around the world. LOS ANGELES, June 01, 2022 -- ( BUSINESS WIRE )-- OpenGate Capital, a global private equity firm, announced that it has exited its investment in EverZinc, a global provider of specialty zinc . here to register, Not for publication, email or dissemination, Veritas-backed HMH buys educational services nonprofit NWEA, Professional services company FMP inks $36.5m from Alaris, NMS recaps environmental services firms Texas Pride and Texas Dumpster Companies, MSCP invests in services for homeowners; Patient Square launches platform for medical device makers, Leonard Green to acquire minority stake in HUB; plus Investcorp, Sound Partners, Odyssey invest in HVAC, 700 million people will make their home in African cities over the next decade, said DPIs Marc Stoneham. As part of the transition process, OpenGate Capital has renamed the business to EverZinc. The firm faced six different lawsuits after abruptly laying off Pennysaver employees in the middle of a work day and failing to give workers their final paychecks. It maintained operations during the worst of the pandemic and even. OpenGate Capital is a global private equity firm active in the lower middle-market and focused on acquiring corporate carve-outs, divestitures and special situations throughout North America, Western Europe and Latin America. A link has been emailed to you - check your inbox. The companys shares closed at $84.46 on Friday on the Nasdaq. With a strategic international presence and a focus on corporate carve . The acquisition financing was arranged via a unitranche by Deutsche Bank as . The firm shut down its Fusion Paperboard plant just three years after acquiring it, 18 months after signing a 10-year loan from the state to remain operational, and only a few months after entering into a six-year contract with the local steelworkers union. Hufcor employees, Janesville residents, and union organizers have rallied against OpenGates greedy and exploitative practices. When PennySaver closed on May 22, it left 678 employees without a final paycheck or compensation for their accrued vacation days and it meant they had to scramble for health benefits. Inequality.org is a project of the Institute for Policy Studies, Content licensed under a Creative Commons 3.0 License, Inequality Quotes by Historic World Leaders, Private Equity Can Kill: Fight Wall Streets Deadly Power in Nursing Homes, Labor Celebrates as Michigan Senate Votes to Overturn Right-to-Work Law. Last year, an OpenGate portfolio company called Fusion Paperboard in Sprague, Conn., shut down, eliminating 145 jobs and defaulting on the $1.8-million balance of a state-subsidized loan, according to the state Department of Economic and Community Development. No tags have been applied so far. employees in the middle of a work day and failing to give workers their final paychecks. 9JANESVILLE The labor union that represents workers at Janesville's Hufcor factory is now pressuring Hufcor owner OpenGate Capital with a shame campaign that's playing out in Los Angeles, OpenGate's corporate home city. Nikou was born in 1977 in Vancouver, British Columbia, Canada. The list is updated frequently, so check . In 2010, Nikou was named a Top Dealmaker of 2010 by Mergers & Acquisitions magazine. Attorneys are either actively filing these cases or investigating to determine whether lawsuits can be filed. 3 min read. [35][36][37], Nikou is married with children and resides in Nevada.[7]. Uber drivers and other app-based workers are facing an all-out safety crisis. In 33 years with the 83-year-old company, he saw it operate under three different owners, most recently OpenGate Capital. To date, OpenGate has laid off 678 California workers from the Pennysaver classified ad magazine, 100 Wisconsin workers at its Golden Guernsey dairy plant, 140 employees of the Connecticut boxboard company Fusion Paperboard, and nearly 200 employees in Texas, Arkansas, and Wisconsin, who worked for Hamilton Scientific, an OpenGate-owned laboratory furniture company. So far, six lawsuits have been filed against OpenGate Capital and/or PennySaver in local and federal courts for failing to notify employees of mass layoffs, according to Richard McCune, a lawyer representing PennySaver employees. Defendants OpenGate Capital, LLC and OpenGate Publishing, LLC (collectively, "the Open Gate entities" or "Defendants") filed the Motion to Disnnss that is presently before the Court. Open Gate Capital aquired my company Pennysaver USA 1 1/2 years ago. We need to take legislative action in Congress to rip up the predatory playbook that these private equity firms use to leave workers with nothing but pink slips and lost livelihoods, Senator Tammy Baldwin of Wisconsin wrote. The cases that former employees have highlighted as OpenGate failures include: the shuttering of Golden Guernsey on a Saturday morning in 2013, with no notice to employees; the closure of Connecticut-based Fusion Paperboard shortly after it had received a state loan to stay put for 10 years; and the shutdown of OpenGates laboratory furniture business, Hamilton Scientific, after it discovered that a drug cartel had overrun its Mexico plant and it was evicted from its Texas facility. On Friday May 21,2015 they fired all employees. But those changes did not prepare workers for its sudden closure when, in the middle of the afternoon on a Friday, employees were asked to pack up and leave. Six months after the purchase, OpenGate sued Thermo Fisher, saying the company had concealed the fact that the Reynosa, Mexico, facility was under seige by the Gulf cartel, whose senior members brandished weapons at company employees and parked tractor trailers and cars at the facility. It agreed to provide $3.1 million in financing in November 2013 for five days. Confronted with this looming loss, Hufcor employees, Janesville residents and CWA union organizers have rallied against OpenGates greedy and exploitative practices. OpenGate Capital has a history of buying companies, only to close operations shortly thereafter, leaving communities across the country in the lurch. This spring, Hamilton Scientific, a De Pere, Wis., lab equipment maker owned by OpenGate, abruptly shut down, laying off 80 people there and 190 at plants in Texas and Arkansas without notice, according to a lawsuit filed by former employees. Private equity, an ownership structure that puts distant financiers in charge of how a business is run, has been shown to result in worse health outcomes for patients, at greater cost. Among them were a French childrens book publisher, a Finnish paper producer, the Nicole Farhi division of fashion firm French Connection and Models One Ltd., the modeling agency that has represented supermodels Bar Refaeli, Alessandra Ambrosio, Linda Evangelista and others. Federal Civil Lawsuit California Central District Court, Case No. In fact, prosecutors allege, it was the senior Dardens neer-do-well son who had already spent three years in jail on an unrelated stock swindle looking to buy the lad mag. A court filing by the trustee overseeing the bankruptcy proceedings said Golden Guernsey owed $1.5 million because it had violated state labor laws that require 60 days notice to employees of mass layoffs. Barry L. Kasoff, president of Realization Services who served as PennySavers chief restructuring officer, denied the assertion and said the decision to close with little notice was dictated by Capital One.
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