Central Sprinkler Corporation

Division: Phoenix Management Services


Central Sprinkler Corporation was a publicly traded $250 million manufacturer and distributor of fire sprinklers based in Pennsylvania.


Due to the effects of an allegedly defective product, a lawsuit from the U.S. Consumer Products Safety Commission, seven class-action law suits and lenders who had called its loans, the Company found itself distracted from its primary business and position in the marketplace. The Company’s share price plummeted from a high of $48 a share to $5.50 a share.


Phoenix Management Services resolved the litigation with both the CPSC and with the seven class-action suits and refinanced a $110 million credit facility. Shortly thereafter, Phoenix negotiated and structured the sale of the Company for $30 per share to Tyco, a six-fold increase in value.