Galls, Lexington-based provider of public safety equipment, sold

Lexington company employs 570, sells gear for police, fire, E.M.s.

ssloan@herald-leader.comOctober 4, 2011 

Galls' headquarters is at 2680 Palumbo Drive. The company employs 570 people, with 430 in Lexington.

DAVID PERRY | STAFF

A New York-based private investment firm announced Monday it has bought public safety equipment provider Galls with an eye toward acquiring smaller firms in its industry and folding them into the Lexington-based company's operations.

CI Capital Partners acquired Galls for an undisclosed sum from food service and uniform company Aramark.

"Galls is an exceptional brand in the space that they're in," Thomas Ritchie, managing director of CI Capital Partners, told the Herald-Leader. "That space is a fragmented one. Those two elements are a great combination for our investing style.

"We're quite excited about this opportunity."

Galls, which had revenue of $163 million in its past 12 months, has its roots locally in the Phillip Gall & Son store that opened in 1904 and became known for sporting goods. Over the decades, the secondhand shop expanded into men's clothing, police equipment and other product lines. Divisions including police equipment eventually were sold off and became Galls.

Today, Galls specializes in selling public safety equipment through its catalogs, Web site, sales teams and nine retail stores spread in Kentucky, California, Illinois and Texas.

Galls president Larry Dismukes said the sale process began about seven months ago, when "Aramark and Galls agreed after a lot of research and thought ... that Galls was best fit to be spun off."

In a statement, Aramark CEO Joseph Neubauer said, "This opportunity with CI Capital Partners enables Galls to pursue accelerated expansion and better positioning on which to grow and build its brand."

Dismukes said the deal would put a much greater focus on Galls.

"In the Aramark world, we were one of the smallest businesses that Aramark owned," Dismukes said. "While we were doing well, we weren't always at the forefront of Aramark's growth plans. CI, on the other hand, sees us as a significant piece of their portfolio."

CI Capital Partners bills itself as targeting industries that are ripe for consolidation. Among the companies it owns are Conney Safety Products, which markets workplace safety equipment.

"While Conney is not a competitor to us, it clearly demonstrated CI's capability to acquire a safety distribution company, and they've had tremendous success with the company," Dismukes said. "We feel like the success they had with Conney, they'll also be able to have with Galls."

Lexington's role in the operation could be strengthened. The company has 570 employees, with 430 at the Lexington headquarters. Dismukes said the new management thinks Galls probably can "go out and acquire some other businesses" and grow its current operations in other markets, "and we can service that out of Lexington."

Some of that growth might be coming in some of Galls' smaller lines of business.

"Our core customer is law, fire and EMS," Dismukes said. "But because of the product line we sell, it's allowed us to move over to adjacent businesses like the Postal Service and transit authorities. We're growing in those adjacent markets."

The company recently struck a deal to supply the Chicago Transit Authority, leading to the opening of two retail stores in the city.

"We see that continuing in the future," Dismukes said. "We're working on a major police and fire department in the country now."

Reach Scott Sloan at (859) 231-1447 or 1-800-950-6397, Ext. 1447.

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