Graham Partners Converts Stone into Gold

June 2nd, 2004


Eldorado Stone, one of Graham Partners’ ten current portfolio companies, was sold today in an all cash transaction to Headwaters, Inc. (NASDAQ: HDWR) for an enterprise value of over $202 million, plus an excess working capital adjustment of approximately $8 million.

Eldorado, headquartered in San Marcos, California, is a rapidly growing producer of architectural stone veneer for residential and commercial siding applications. With a reputation for outstanding product quality and exceptional customer service, Eldorado has attained a leading market position in its industry niche. Eldorado’s products are manufactured at multiple facilities strategically located within the United States, and are sold to a customer base extending throughout the World.

Graham Partners, which is an industrial-focused private equity firm targeting the lower end of the middle market, acquired Eldorado in February 2001. During Graham’s roughly 3-year ownership of the Company, the private equity firm worked with management to nationalize Eldorado’s product offering, consolidate its outstanding base of franchisees, and increase sales by over 300%.

“We are very pleased with what we accomplished with Eldorado in a relatively short time frame. Along with management, we were not only able to achieve dramatic growth and establish a national brand of stone veneer products, but also to transition the Company from an entrepreneurial focus to a professionally managed company, with significantly enhanced operational procedures and management reporting capabilities,” said Joe May, a Managing Principal at Graham Partners. “We will miss partnering with Eldorado’s outstanding management team and sharing in the Company’s future growth, but it is prudent to monetize what is already a very successful investment. ”

Graham’s strategy is to acquire businesses, like Eldorado, that are benefiting from product substitution or raw materials conversion trends in their industries, where Graham Partners can utilize its extensive operating resources, contacts and expertise to add value during its holding period. In Eldorado’s case, the Company is the beneficiary of the ongoing shift to manufactured stone from traditional siding materials, such as natural stone, brick, stucco, and vinyl.

About Graham Partners: Graham Partners is a private investment firm based in suburban Philadelphia managing $227 million in committed capital. Graham Partners is an investment affiliate of the privately held Graham Group of York, Pennsylvania, an industrial and investment concern with global interests in plastics, packaging, machinery, building products and outsource manufacturing. Graham Partners seeks to acquire industrial companies with revenues between $20 million and $250 million that participate in manufacturing niches where Graham Partners can leverage its unique combination of operating resources and financial expertise.



Rob Newbold (
Joe May (
Christina Morin (
Tel: 610.408.0500 / Fax: 610.408.0600