Baird Capital’s US Private Equity group has completed the sale of its portfolio company American Auto Auction Group (AAAG) to Huron Capital Partners.
“When we created American Auto, our goal was to build a national full-service, dealer-centric re-marketing platform by pulling together a group of strong independent auctions, and layering on new services,” said Randy Mehl, Partner with Baird Capital’s Private Equity group. “Over the last few years, we worked with AAAG’s management team to expand the company’s footprint through several acquisitions in targeted regions, while adding financing and technology capabilities to those businesses.”
Baird Capital established American Auto Auction Group in 2010 to execute an acquisition platform strategy in the whole car auction market. During the course of ownership, AAAG acquired six auction businesses, and the number of cars run through auction annually has grown from approximately 55,000 to more than 215,000. The company’s acquisitions include Auctions in Motion (Westlake Village, CA), Badger State (Fond Du Lac, WI), Charleston Auto Auction (Moncks Corner, SC), Mid-South Auto Auction (Pearl, MS), Texas Lone Star Auto Auction (Carrollton, TX) and Your Auction (Tampa, FL). The company is headquartered in Charleston, SC (www.americanaag.com).
“Baird’s credibility as a financial partner, commitment to the strategy, and extensive network of contacts were important drivers for our expansion, and we thank them for all of the contributions they have made,” said Darris McClure, AAAG President.
Baird Capital, the direct private investment arm of Robert W. Baird & Co., invests in lower middle-market companies in the manufactured products, healthcare and business services sectors. The firm invests from $15 million to $35 million in companies with enterprise values of $25 million to $125 million and EBITDAs greater than $5 million. Baird Capital was founded in 1989 and is based in Chicago (www.bairdcapital.com).
In acquiring AAAG, Huron partnered with industry veteran Cam Hitchcock, who will join AAAG as CEO. Mr. Hitchcock is an experienced industry veteran having recently served as the Executive Chairman of Primeritus Financial Services and Partner at Elysian Advisors. He has also served on the boards of two private equity-backed auction remarketing companies. Earlier, he was President and CEO-Dealer Services Group and Corporate CFO of ADESA, an automotive auction and remarketing services company.
“I am honored and excited to partner with Huron and the AAAG senior management team. We have closely watched the dealer sale market segment over the last 24 months and believe that there are significant opportunities to better serve dealer consignors in many US markets. Our objective is to provide AAAG’s customers with highly responsive, tailored service offerings across multiple geographies. Huron has committed significant capital to enhance and scale this platform, and we look forward to deploying it,” said Mr. Hitchcock.
“Huron is very excited to partner with the AAAG family of auctions, their employees, and customers to continue building what we believe is the preeminent national auction group focused primarily on dealer to dealer sales. In the years to come, we intend to make a difference in the lives of people by investing in our team and the communities we serve,” said Peter Mogk, Senior Partner at Huron. “We know from experience that value-added customer service begins with equipping our people with the best facilities, training and career opportunities. We believe we have ample resources dedicated to build, grow and acquire auctions that embrace technology and ever-changing customer needs.”
Huron Capital Partners invests up to $70 million per transaction in middle market companies that have revenues up to $200 million and EBITDAs of $5 million or more. Sectors of interest include education & training, healthcare, specialty chemicals, specialty packaging, consumer products, home decor, business services, industrial manufacturing, food & beverage, and marketing services. The firm was founded in 1999 and currently manages over $1.1 billion in committed equity through four private equity funds. Huron Capital Partners has offices in Detroit and Toronto (www.huroncapital.com).
2014 PEPD • Private Equity’s Leading News Magazine • 5-27-14
