TSE manufactures and distributes custom engineered interconnect products for a variety of mission critical applications, specializing in custom molded wire and cable products for patient-critical medical devices and measurement instrumentation.
In 2006, Pfingsten met the group of entrepreneurs who owned and operated the company. The CEO and his management team were looking for a partner with strong operating and global capabilities, and believed our conservative approach to leverage aligned with their focus on accelerating top line growth.
TSE held a niche leadership position in the high-growth medical wire and interconnect market, with meaningful long-standing relationships with blue-chip medical customers such as Medtronic, St. Jude Medical and GE Healthcare. TSE built its reputation by creating a broad product offering across medium to high-end custom engineered applications that required technical expertise and development support. Alongside management, we saw the potential to expand the business by adding sales and marketing resources to expand geographic reach, adding engineering resources to improve new product design and prototyping, improving distribution margins through our over-seas global sourcing capabilities, and improving internal systems such as data gathering, measurement and warehouse processes. The company also competed in a highly fragmented medical interconnect market, where TSE could target specific product line expansion to add to its growing product offering.
Post-acquisition, TSE implemented a series of operational improvements to drive increased revenue and profitability. The company added manufacturing at its Taiwan facility and created a detailed plan to establish a facility in mainland China. On a product level, TSE focused on therapeutic segments of the medical device industry, which are non-discretionary and more recession-proof, and, through our acquisition of Connect-Tech, expanded the Company’s fine wire capabilities to access a $350 million market for medical ultrasound cables. In addition, as identified through the strategic planning process and continuous improvement initiatives, TSE created customer-focused teams which were responsible for managing customer requirements from development through full-scale production, and opened a “learning center” to formalize the continuous improvement process.
Headquarters: Arlington, Minnesota
Industry: Medical Device and Instrumentation Manufacturing
Acquired: June 2006
Divested: July 2010
Case studies have been selected for illustrative purposes only. The specific portfolio companies identified are not representative of all active or prior Pfingsten portfolio companies; results may not be typical and it should not be assumed that investments in other portfolio companies will be or were as profitable. Investment in a fund involves significant risk, including loss of the entire investment.