Archives for December 2012

Encore Consumer Capital Closes Fund 2 Above Target

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Encore Consumer Capital, a consumer goods focused private equity firm, has closed its second fund with $211 million of commitments, exceeding its target fund size of $200 million.

Encore Consumer Capital secured commitments from a diversified investor base with the majority of commitments coming from investors in Encore Consumer Capital’s $175 million first fund. Encore II’s investors include endowments and family offices, insurance companies, fund of funds, and pension funds.

MVision Private Equity Advisors serves as the placement agent and Latham & Watkins as fund counsel.

“We are extremely pleased to have the strong support of our existing investors as well as new investors for Fund II.  The high caliber of our investor base provides us with long term partners and advisors which are critical to our continued success and ability to execute unique transactions in the consumer products space,” said Scott Sellers, Managing Director and Co-Founder.

Encore Consumer Capital will use the proceeds from Fund II to continue to invest in lower middle market companies with leading positions in attractive segments of the consumer products industry.  “Our firm is uniquely positioned due to our focus on companies with revenues between $10 million and $100 million and our ability to bring operating expertise to the table.  Partnering with successful entrepreneurs and family-owned businesses to bring them insightful counsel, growth strategies, and opportunities for liquidity is our hallmark,” said Robert Brown, Managing Director and Co-Founder.

Encore Consumer Capital invests exclusively in consumer products companies to utilize its own consumer experience and the expertise of its operating partners at Encore Associates, a strategic advisory firm to the consumer products industry.  Encore Consumer Capital is headquartered in San Francisco (www.encoreconsumercapital.com).

© 2012 PEPD • Private Equity’s Leading News Magazine • 12-20-12

Prospect Capital Backs Recap of Palladium’s Taco Bueno

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Prospect Capital Corporation has provided $23.2 million of secured debt financing for the recapitalization of Taco Bueno, a portfolio company of Palladium Equity Partners.  The purpose of the recapitalization was for the repayment of existing debt and to provide a dividend to existing shareholders.

“We are impressed with CEO Ed Lambert and the rest of Taco Bueno’s management team, along with the company’s ability to successfully perform over a 45 year history,” said Richard Carratu, a Managing Director of Prospect Capital Management. “The recapitalization of Taco Bueno demonstrates Prospect’s ability to provide real value to financial sponsors, while generating a compelling yield for our shareholders.”

Taco Bueno operates as a quick service restaurant chain offering fast, casual, and quality Mexican cuisine. Taco Bueno operates 155 company-owned and 20 franchised locations across the Southwestern region of the US.  The company was founded in 1967 and is headquartered in Farmers Branch, TX (www.tacobueno.com).

“We continue to be pleased with our financial results, and we are very excited about Taco Bueno’s potential in the years to come,” said Edward Lambert, CEO of Taco Bueno. “We are leveraging the strength of our brand and geographic positioning to capitalize on a number of important growth opportunities, including store growth within our core markets, new territory development, and the extension of menu offerings.”

Prospect invests from $10 million to $75 million in private and micro-cap public businesses located in the US and Canada that have from $3 million to $30 million of EBITDA. Investment structures include: senior debt; unitranche debt; 2nd lien and mezzanine debt; and “one stop” debt and equity. The firm invests in wide array of industries and is effectively industry agnostic. The firm is located in New York (www.prospectstreet.com).

Palladium Equity Partners targets investments in business services companies as well as in financial services, consumer/retail, food/restaurants, healthcare, industrial and media businesses. Palladium has a focus on companies that operate in the US Hispanic market. The principals of Palladium have invested over $1.5 billion of equity in 50 portfolio companies over the last two decades.  The firm was founded in 1997 and is based in New York (www.palladiumequity.com).

© 2012 PEPD • Private Equity’s Leading News Magazine • 12-20-12

CIT Backs Latest Webster Acquisitions

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CIT Group has arranged and syndicated $90 million in senior secured credit facilities to support Epic Health Services’ acquisitions of Santé Pediatric Services and AmeriCare.  Epic Health Services is a portfolio company of Webster Capital.

CIT Healthcare served as Sole Lead Arranger, Bookrunner and Administrative Agent for the transaction and financing was provided by CIT Bank, a wholly-owned subsidiary of CIT.  “With a substantial balance sheet and a proven ability to deliver promised results with certainty under a tight timeline, CIT Healthcare was the natural partner for us on this transaction,” said David Malm, Senior Partner and head of Webster Capital’s Healthcare practice.

Santé Pediatric Services is a pediatric provider of speech, occupational, medical nutrition and physical therapy. The company is based in Frisco, TX (www.santepediatrics.com).

“We are delighted to partner with Epic Health Services and Webster Capital in their continued growth,” said Steve Warden, President of CIT Healthcare. “This transaction further underscores our ability to successfully support the growth capital needs of our clients, as well as our continued commitment to providing financing and advisory solutions for middle market healthcare companies.”

Epic Health Services is a provider of pediatric home health and therapy services as well as geriatric in-home services.  In conjunction with its Freedom Home Healthcare segment, the company provides services to over 6,000 clients across five states. As the largest pediatric home health agency in Texas, Epic meets the private duty nursing and therapy needs of medically-fragile and chronically ill children. The company was founded in 2011 and is based in Dallas (www.epichealthservices.com).

“CIT’s understanding of the services we offer resulted in dependability and added flexibility to our financing. We expect to grow our relationship with CIT Healthcare as we continue to expand our market-leading services to medically fragile children and adults in their homes,” said John Garbarino, President and CEO of Epic Health Services.

Webster Capital invests in branded consumer, business- to-business, and healthcare services companies with EBITDAs from $3 million to $15 million and transaction values less than $100 million. The firm is currently investing Webster Capital II, a $205 million fund which closed in 2007.  Webster was founded in 2003 and is based in Waltham, MA (www.webstercapital.com).

CIT is a bank holding company with more than $33 billion in assets. Sectors of interest include small business and middle market lending, factoring, retail finance, aerospace, equipment and rail leasing, and vendor finance.  CIT was founded in 1908 and is based in New York (www.cit.com).

© 2012 PEPD • Private Equity’s Leading News Magazine • 12-20-12

Ridgemont Acquires J.A.M. Distributing Company

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Ridgemont Equity Partners has made a majority equity investment in J.A.M. Distributing Company (JAM), a distributor of lubricants, fuel, base stock and ancillary products.

“Our first introduction to Ridgemont displayed their professionalism and knowledge of investing in diverse industries. They definitely had a very strong interest in JAM and the desire to make a substantial investment in my company. I believe that Ridgemont Equity Partners will be a very good fit for JAM because of their commitment to our employees, customers and the continued growth of our business. I wish the new partnership a long and very prosperous future,” said Johnny Maniscalco, founder of JAM.

J.A.M. Distributing Company is a distributor of lubricants, fuel, base stock, and ancillary products for the industrial, commercial vehicle, passenger vehicle, and marine end markets. The company operates as one of ExxonMobil’s leading US lubricant distributors.  JAM is headquartered at its main terminal in Houston with additional terminal operations in Dallas, Beaumont, Lufkin, Clute and Galveston (www.jamdistributing.com).

With the sale of JAM to Ridgemont, Mr. Maniscalco will be retiring from the day-to-day operations of JAM.  “We recognize the tremendous accomplishments of the company’s founder and retiring CEO, Johnny Maniscalco, in building JAM into the organization that it is today, and we wish Johnny our best going forward,” said Jack Purcell, a Principal at Ridgemont.

Ridgemont Equity Partners (formerly Banc of America Capital Investors) focuses on middle market buyout and growth equity investments of $25 million to $75 million. The firm invests in the following sectors: basic industries and services; energy; healthcare; and telecommunications/media/technology. Ridgemont Equity Partners is headquartered in Charlotte, NC (www.ridgemontep.com).

“We are pleased to partner with senior management of JAM and continue upon the company’s long history of providing industry leading products and services to its customers in several markets throughout the state of Texas,” said Rob Edwards, a Partner at Ridgemont.

© 2012 PEPD • Private Equity’s Leading News Magazine • 12-20-12

Graham Partners Acquires Universal Cold Storage and Universal Pasteurization

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Graham Partners has completed its initial investment in the food processing technology space, having formed UCS & UPC Holdings Company to acquire Universal Cold Storage and Universal Pasteurization (Universal), providers of cold storage and high pressure pasteurization services.

“We have established ourselves as the nation’s leading independent high pressure pasteurization service provider,” said John Jacobson, Universal’s founder and CEO.  “Our industry leading reputation for unmatched customer service and state-of-the-art facilities enables us to offer an unbeatable solution. Graham is the ideal partner for Universal with its strategic vision and broad operating resources.”

Universal is a provider of cold storage, high pressure pasteurization, and other value-added services to domestic food manufacturers.  The company is based in Lincoln, NE (www.universalcoldstorage.com).

High pressure pasteurization (HPP) is a non-thermal, non-chemical based method of pasteurization.  Demand for HPP is driven by its ability to offer enhanced food safety while enabling food manufacturers to offer all-natural products with improved nutritional value and extended product shelf life.  In Universal’s case, a conversion is underway towards HPP from traditional methods of pasteurization, creating the opportunity for growth as penetration continues.  Industry research suggests that adoption of HPP may increase as much as 20-30% annually as consumer awareness increases and the technology continues to gain acceptance.  Graham Partners proactively identified HPP as an attractive investment niche and initiated a direct calling effort targeting businesses in the industry, which yielded the Universal acquisition opportunity.

 “Graham’s focused sourcing efforts paid off,” said Andrew Snyder, Managing Principal at Graham Partners. “We believe this is the ideal time to invest in the HPP niche, where Universal has established itself as the industry leader. Universal’s complementary value-added services offering has enabled Universal to become a key strategic partner with its customers. We are excited to work with the management team to further expand the business and drive strategic growth initiatives.”

Graham Partners seeks to acquire industrial companies with revenues between $30 million and $500 million that participate in manufacturing niches where it can leverage its combination of operating resources and financial expertise.  The firm is sponsored by the Graham Group, an industrial and investment concern with interests in plastics, packaging, machinery, building products and outsource manufacturing.  Graham Partners is headquartered in Philadelphia (www.grahampartners.net).

© 2012 PEPD • Private Equity’s Leading News Magazine • 12-20-12

Pouschine Cook Acquires Griswold Home Care

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Pouschine Cook Capital Management has acquired Griswold Home Care, a nationwide non-medical home care franchisor.

“We have a 30-year history advocating for clients, caregivers, and referral sources in our home care community.  Along this journey, like-minded individuals and groups have contributed to the growth and success of the organization.  It was our intent to select investors that shared our values and vision for Griswold,” said Graham Weihmiller, President and CEO of Griswold Home Care, “Together we are excited to accelerate the initiatives important to the ultimate goal of enabling clients to receive outstanding, compassionate home care at an affordable rate.”

Griswold Home Care provides non-medical home care services. The company was founded by Jean Griswold over 30 years ago in the Philadelphia suburbs and today Griswold Home Care serves clients across 31 states. The company is based in Erdenheim, PA (www.griswoldhomecare.com).

“Griswold is a well-managed business with substantial growth prospects,” says John Pouschine, co-founder of Pouschine Cook. “Graham Weihmiller, Tom Monaghan and the rest of the team have done an excellent job building the business, and we look forward to taking advantage of the growth opportunities with them.”

Pouschine Cook Capital Management invests from $5 million to $25 million in companies with $20 million to $250 million in revenue and at least $5 million of EBITDA that have a leading position in their niche or industry and significant growth opportunities.  The firm is based in New York (www.pouschinecook.com).

“Graham and Tom have done a fantastic job expanding Griswold Home Care to a national footprint, and we are excited to support their future visions for the company. The combination of our franchise and home care investment experiences should allow us to guide the company’s long term strategy,” said Geoff Teillon, Principal at Pouschine Cook.

© 2012 PEPD • Private Equity’s Leading News Magazine • 12-20-12