A private-equity firm has purchased majority control of Dauphin County-based HydroWorx International Inc., a manufacturer of underwater treadmills and therapy pools.
Anson Flake, co-founder of HydroWorx and CEO of the company since 1997, said he was looking to step back from the day-to-day operations and found a merger partner in Alliance Holdings Inc.
Alliance, based in Montgomery County, is a private-equity firm that invests across multiple business sectors, including industrial and manufacturing, business services, health care, consumer and specialty finance.
“I wanted someone who would keep the employee base in Central Pennsylvania and someone that would be cool with someone in HydroWorx leadership taking my spot,” Flake said.
Matt Foss, who has been with the company since 2010, is now the company’s CEO. Flake, 50, will remain an investor in HydroWorx, along with his partners.
Flake declined to disclose his percentage of ownership, as well as what Alliance paid to assume control of the company. The deal closed Dec. 16.
“For right now, I’m just going to decompress and focus on the family,” Flake said, which was his main motivation for selling his majority interest. “I’m going to miss seeing our employees and seeing the customers every day. This is bittersweet for me.”
However, Flake said he liked that Alliance is converting HydroWorx to an employee stock ownership plan, or ESOP, giving employees a stake in the company. Alliance is 100 percent employee-owned.
He also liked Alliance’s “indefinite holding period” for companies it invests in, meaning that it holds onto the companies it buys instead of selling them off quickly.
Flake said operations will not change and that Alliance is committed to growing the business.
“Alliance’s investment in HydroWorx continues the mission we began in 1995, to build a sustaining, diversified company that provides a strong, secure retirement vehicle for our employee owners,” Kenneth Wanko, CEO of Alliance, said in a statement. “The Alliance team is thrilled to be partnering with such a passionate and dedicated team at HydroWorx and we all look forward to continuing the path that Anson Flake began when he founded the company.”
HydroWorx, based in Lower Swatara Township, has 50 employees.
HydroWorx estimates that its products touch the lives of about 30,000 people every day. Flake said he hopes the partnership with Alliance will take that to more than 50,000 people every day.
HydroWorx enjoyed a recent marketing bump thanks to a viral video highlighting the training benefits of a new underwater treadmill product.