Archives for July 2012

Riveron Adds Dan Conkright to Team

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Riveron Consulting, a financial consulting firm serving private equity funds, has announced the addition of Dan Conkright as a new Director to the firm. Mr. Conkright will be based in Houston while having responsibility for serving Riveron’s clients in Dallas and the diverse markets served by the firm.

Most recently, Mr. Conkright was with Cameron International Custom Process Systems in Houston, where he was a business partner and functional CFO to the Group President, assisting in all business decisions and strategy. Prior to his tenure at Cameron, he was based in Reynosa, Mexico serving as interim director of finance for Helmerich & Payne where he managed the strategic closure of the Mexico division. He also served as the interim director of finance for Calfrac in Poza Rica, Mexico, where he was responsible for organizational rescue of a $30 million revenue well services provider. Additional experience includes work with CH2M Hill International, Grant Prideco, Enron Corporation, Parker Drilling and Western Geophysical. Mr. Conkright attended the University of South Carolina where he received his Bachelor of Arts in International Relations. He later went on to earn his Master of International Management at Thunderbird School of Global Management.

“We believe Dan is a great, strategic addition to Riveron’s team. Dan’s experience in Houston and international markets, his energy industry experience, as well as his post-transaction skills add valuable dimensions to our capabilities,” said Matt Bender, Managing Director of the Riveron’s Dallas office.

Riveron is a financial consulting firm serving middle-market private equity funds and companies growing through acquisitions. Riveron Consulting is not a CPA firm; however, most of Riveron’s principals have large firm public accounting experience. Riveron helps clients maximize the value of strategic and financial transactions through buy-side financial due diligence, sell-side services and post-transaction special projects. Founded in 2003, Riveron is headquartered in Dallas and has an office in Chicago (www.riveronconsulting.com).

Brentwood Associates Acquires Sundance Holdings Group

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Brentwood Associates has announced that it has acquired a majority stake in Sundance Holdings Group, a multi-channel retailer of women’s apparel and accessories. Selling shareholders, including ACI Capital and Webster Capital, will retain a minority ownership stake, and the business will remain under the leadership of current president and CEO Matey Erdos.

“Brentwood brings tremendous insight as we embark on the next level of growth,” said Mr. Erdos. “Their experience in direct marketing and multi-channel retail, as well as their track record of building consumer brands, is extremely relevant to our future success.”

Sundance Holdings Group (Sundance Catalog) was founded by Robert Redford in 1989 and is a multi-channel direct marketer and specialty retailer of women’s apparel and accessories, jewelry and home furnishings. The company is based in Salt Lake City (www.sundancecatalog.com).

“Sundance Catalog has grown to become a unique lifestyle brand with a compelling assortment of products that serve a large and highly loyal base of customers,” said Eric Reiter, a partner at Brentwood. “As partners with management, we will continue to build upon the company’s successful multi-channel distribution, and we expect significant growth as the business expands its product offering and broadens its retail footprint.”

Brentwood Associates is a consumer-focused private equity investment firm. Sectors of interest include branded consumer products; consumer and business services; direct marketing, including direct mail and e-commerce; education; health and wellness; restaurants; and specialty retail. The firm was founded in 1972 and is based in Los Angeles, CA (www.brentwood.com).

“We see tremendous opportunity in the Sundance Catalog’s direct-to-consumer channels as management is in the early stages of leveraging a vast e-commerce toolset to more effectively serve their customers,” said William Barnum, Jr., a partner at Brentwood and co-founder of the firm’s private equity effort. “Furthermore, we believe the company’s retail strategy represents a significant growth opportunity and an additional path to deeper brand penetration.”

The acquisition is being partially funded through a combination of senior and subordinated debt. OneWest Bank is acting as administrative agent for the senior credit facility, while GarMark Partners is providing the subordinated debt.

Brentwood was represented by Greenberg Traurig in conjunction with the transaction. Sundance Catalog was advised by Lazard Middle Market with legal advice from Kaye Scholer.

TA Associates Invests in Forgame

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TA Associates today announced that it has completed a significant minority investment in Forgame Tech Co., Ltd, a developer and publisher of online, browser-based games. Qiming Venture Partners and Ignition Capital Partners partnered with TA Associates on the investment.

“TA Associates, Qiming Venture Partners and Ignition Capital Partners are pleased to complete this investment in Forgame, the leader in the vibrant Chinese browser-based gaming industry,” said Jason Tan, Director – China, TA Associates Asia Pacific. “With a diversified revenue stream, proven content development capabilities and a comprehensive game distribution network, Forgame has achieved significant growth since its founding. Given its robust product pipeline across multiple game categories, we anticipate continued strong performance by Forgame.”

Founded in 2008, Forgame is one of the largest web game companies in China. Forgame has developed 28 cloud-based multiplayer online games, including Ming Dynasty, Soul Guardians, Soul Guardians 2, Fantasy Ascension, The Ninth Heaven and Legend of Chaos. Under the “freemium” model, players can play all of Forgame’s games for free, and purchase in-game virtual goods and privileges to enhance their gaming experience. As of June 2012, Forgame’s publishing platform had more than 110 million registered users. The group is headquartered in Guangzhou, China (www.forgame.com).

“We continue to see a favorable shift to browser-based, freemium games, with revenue from virtual goods sales expected to grow significantly,” said Hans Tung, Managing Partner, Qiming Venture Partners, who will also join Forgame’s Board of Directors. “As the free-to-play model allows a user to play without purchasing an expensive game console, it is particularly attractive in regions with historically limited console markets such as China, South Korea and continental Europe. We anticipate significant ongoing market opportunities for Forgame in these regions.”

TA Associates makes buyouts and minority recapitalizations of profitable growth companies in the technology, financial services, business services, healthcare and consumer industries. Since founding in 1968 TA has invested in over 400 companies globally and has raised more than $18 billion in capital. The firm has offices in Boston, MA; London, UK; Menlo Park, CA; and Mumbai, India (www.ta.com).

Qiming Venture Partners is an early to growth stage venture capital firm with offices in Shanghai, Beijing and Hong Kong. Qiming invests in young, fast-growing companies across China in the media and Internet, IT, consumer and retail, healthcare, and clean technology sectors. Founded in 2006, the firm manages four funds with over $1 billion in assets (www.qimingventures.com).

Ignition Capital Partners seeks to build and expand a select group of highly profitable, long-term businesses that occupy significant positions in their industries. The firm specializes in growth equity and specialized buyout investments. Ignition Capital Partners is based in Seattle (www.igncap.com).

O’Melveny & Myers provided legal counsel to TA Associates, Qiming Venture Partners and Ignition Capital Partners. Jingtian Gongcheng provided legal services to Forgame.

Z Capital Partners Invests in Affinity Gaming

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Z Capital Partners has acquired a 24.97 percent stake in Affinity Gaming, a multi-jurisdictional casino operator with wholly-owned casino operations in Nevada, Missouri and Iowa, becoming its largest shareholder.

“We have great respect for Affinity Gaming and its strong commitment to guests, employees, and partners,” said James Zenni, President and Chief Executive Officer of Z Capital. “This investment has been a two year process and we see significant potential for long-term growth at Affinity Gaming and look forward to supporting management’s efforts to lead the company into its next phase.”

Affinity Gaming is a diversified casino gaming company headquartered in Las Vegas. The company’s operations consist of 12 casinos, nine of which are located in Nevada, two in Missouri and one in Iowa. Affinity Gaming is also the landlord of three additional casinos in Colorado and expects to be licensed to operate those casinos in the second half of 2012. Additionally, Affinity Gaming has entered into a consulting agreement to support the operations of the Rampart Casino at the J.W. Marriott Resort in Las Vegas (www.affinitygaming.com).

“Z Capital has been a long-time supporter of our management, employees and business strategy, and we are excited to see them step up into a more prominent role in our ownership,” said David Ross, Chief Executive Officer of Affinity Gaming. “We believe that this new level of support from Z Capital will provide us with greater flexibility to execute our strategic plan of growing cash flow through elevating our guest experience, enhancing our value proposition and improving the overall performance of our properties.”

Z Capital makes control investments in middle-market distressed companies, operational turnarounds and special situations. The firm targets companies with an enterprise value of less than $1 billion or EBITDA of less than $100 million. Sectors of interest include consumer products, steel, steel processors, agricultural, gaming, leisure, real estate, manufacturing, specialty services and automotive. Z Capital Partners was formed by Mr. Zenni, the former President, co-owner and co-founder of Black Diamond Capital Management. Mr. Zenni co-managed the portfolios of Black Diamond from its inception in 1995 to approximately $9 billion in assets under management and divested his fifty percent equity ownership interest in BDCM in October 2006. Z Capital is based in Chicago, IL (www.zcap.net).

BV Investment Partners Exits Northstar Travel Media

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BV Investment Partners has announced the sale of its portfolio company Northstar Travel Media, a business-to-business information company serving the travel and meeting industries, to The Wicks Group of Companies. This is the fourth exit in 2012 for BV Investment Partners.

“BV’s expertise in the business and information services sector proved pivotal as we worked together to pursue new avenues of growth over the past several years. We are proud of the way we have grown and transformed the business under BV’s ownership and we look forward to working with our new partners at The Wicks Group to begin our next stage of development,” said Thomas Kemp, Chairman and CEO of Northstar.

Northstar is a business information and marketing solutions provider to the travel, tourism, and meetings industries. The company provides information and marketing solutions through a branded portfolio of information, events, research and content products, delivered online and offline. The Northstar assets include Travel Weekly, Meetings & Conventions, Travel Age West, Successful Meetings, Business Travel News, Incentive, Meeting News, and PhoCusWright. The company is based in Secaucus, NJ (www.northstartravelmedia.com).

“Northstar’s superb management team led by CEO Tom Kemp, whom we recruited in 2009, did an outstanding job of growing this company and strengthening its leadership position in its served markets. The company has been transformed from a print publishing business to a multi-dimensional cross platform business information and marketing services company as a result of continued investment in strong leadership, innovative new product development, and complementary acquisitions. We are pleased with this successful outcome and believe the company will continue to thrive under The Wicks Group,” said Andrew Davis, a Managing Director of BV.

BV Investment Partners makes investments in US based companies active in the information and business services, communications and media industries. Since its founding in 1983, the firm has invested $2.6 billion in 75 companies. The firm was founded in 1983 and has offices in Boston, MA and New York, NY (www.bvlp.com).

Nicola Wealth Launches New Fund of Funds

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Nicola Wealth Management, an asset fund management firm serving the investment and financial planning needs of high net worth individuals and families across the Canada, today announced the launch of the NWM Private Equity Fund to allow its clients to gain access to private equity and mezzanine debt with a minimum investment of $25,000. The company and its principals have committed $1 million of personal capital to the new fund, which completed its initial closing this past May and remains open to investment by NWM clients.

The NWM Private Equity Fund (NWM PE Fund) is a “fund of funds” investing directly and indirectly in Canadian and global private equity and mezzanine debt, with an objective of achieving a long-term annual return that is targeted at 5% more than publicly traded equities.

The fund has already made investments in private equity funds managed by Northleaf Capital Partners, TorQuest Partners, Fulcrum Capital Partners and Headwater Equity Partners and has approved additional investments. “To reduce fees and improve returns in this asset class, we plan to co-invest with our private equity managers directly in certain opportunities that present themselves,” explained Mr. Nicola. The NWM PE Fund has been designed to have sufficient diversification to allow an individual investor to have access to partial or full liquidity for their investment after a three-year minimum investment period, subject to certain limitations. “Individual investors are normally precluded from investing in this desirable asset class due to the high minimums required by private equity managers and the preference of many managers to deal primarily with institutional investors,” said Nicola Wealth Management’s founder and CEO, John Nicola.

Nicola Wealth Management was founded in 1994 and has $1.8 billion in assets under management. The firm provides wealth accumulation, retirement and legacy planning services and expertise to high net worth individuals, institutions, and foundations across Canada. Nicola Wealth Management is based in Vancouver BC (www.nicolawealth.com).

Christine Frank Joins Waller Capital Partners as Managing Director

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Waller Capital Partners, a New York-based investment bank, today announced that Christine Frank has joined the Firm as a Managing Director. Ms. Frank will expand Waller’s presence in the information services and technology, and digital media sectors. Ms. Frank brings over 20 years of banking and advisory experience to Waller, including expertise advising companies in B2B information and data services, internet services, application software, advertising technology and marketing services.

“The information services and technology sectors have experienced significant growth in M&A and private placement activity over the last few years as the demand for information and software tools to manage this data has grown exponentially,” said Garrett Baker, President of Waller Capital. “Christine’s deep experience and relationships in this expanding industry will be a strong complement to our leading media and telecom franchise and our growing digital media practice.”

Throughout her 20 year career in investment banking, Ms. Frank has advised companies in the technology, media and telecom sectors and their private equity investors, helping close $26 billion in mergers and acquisitions transactions. Ms. Frank has raised more than $20 billion in capital for her clients through public and private equity offerings, fixed income offerings, and acquisition financing to support Private Equity-backed LBOs.

Ms. Frank joins Waller from Compass Advisers, and previously was with Bank of America where she was Sector Head for Cable, Satellite and Publishing. She has also held senior investment banking positions covering technology, media, and telecommunications companies and their private equity sponsors at Bear Stearns, CIT and BMO Capital Markets. Ms. Frank began her career at Chase Manhattan Bank and Fox Broadcasting Company. She has a BA in Communications from UCLA and an MBA in Finance from Columbia Business School.

“I am pleased to join the Waller Capital team at this exciting point in the firm’s evolution,” said Christine Frank. “As one of the only independent investment banking and advisory boutiques with core expertise across digital and traditional media, cable, communications and information services, Waller is well positioned to capitalize on the ongoing convergence of technology, media and traditional businesses throughout the global economy.”

Founded in 1982, Waller Capital Partners is a boutique investment bank and advisory firm focused on the media, communications and information sectors. Waller Capital provides its clients with expertise in connection with mergers and acquisitions, private placements, asset swaps, restructurings and valuation services. The firm is based in New York, NY (www.wallercc.com).

Rothstein Kass Identifies Latest Private Equity Trends

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Rothstein Kass has published its fifth annual report on private equity trends. The new report, “Private Equity: Searching for Balance,” features the findings of a first quarter 2012 survey of 293 private equity firms.Seventy-seven percent of those polled predicted that there will be more attractive investment opportunities in 2012 than in 2011. A link to a free copy of the report is available at the end of this article.

Despite continued economic uncertainty, only one-third of private equity managers predicted that funds would be compelled to return capital due to a lack of suitable investment opportunities. At the same time, over a quarter of respondents indicated they do not plan to actively raise capital in 2012, though most believe that the U.S. will avoid a double-dip recession.

“Our latest research suggests that the waiting game involving private equity firms seeking attractively priced growth companies and entrepreneurial businesses in need of capital will likely persist. The fundamental issue is that there often remain significant disparities between what buyers are willing to pay and how business owners value the enterprise,” said Tom Angell, Principal-in-Charge of the Rothstein Kass Private Equity Practice. “As a result, we have also seen the continuation of several trends that had started to emerge even before the credit market upheaval. Specifically, there remains an inordinate amount of dry powder on the sidelines, while firms continued to take on more active roles at portfolio companies as they develop longer-term exit strategies that unlock latent value.”

Additional notable findings include:

  • Emerging private equity firms are in short supply in the U.S. Only 33.6 percent of the funds polled are in operation for less than five years. European and Asian private equity firms were more likely to have seen start-up efforts in the last five years.
  • More than 9 percent of firms launched in the last five years have 50 percent or more women or minority ownership.
  • Nearly two-thirds of the firms surveyed believe there will be more exit opportunities for portfolio holdings in 2012, but this is highly dependent on location, with responses in the U.S. (70 percent), Asia (67 percent) and Europe (39 percent) varying.
  • Seventy-one percent of firms polled disagree with the belief that the United States will enter a double-dip recession.

The Rothstein Kass Private Equity Practice provides professional services to private equity and venture capital funds and their portfolio companies across multiple industry segments. The professionals of the Private Equity Practice advise clients on all aspects of private equity transaction, including financing and deal origination, as well as on organizational structure, audit processes and the management of operational and tax matters. Rothstein Kass is based in New York, NY (www.rkco.com).

For the purposes of the study, firms with less than $500 million under management were categorized as “small” (59.4 percent), while those reporting more than $5 billion under management were “large” (18.1 percent). Over 81 percent of firms are located in the U.S., with 10.2 percent in Europe, 4.9 percent in Asia and 3.6 percent in Middle East/Africa and South America.

To register to receive a copy of “Private Equity: Searching for Balance” please click HERE.