July 23, 2014
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Archives for July 23, 2014

Blackstone Acquires Service King Collision Repair

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service king nf1Service King Collision Repair Centers, a portfolio company of The Carlyle Group and one of the largest independent US chains of automobile body repair centers, has entered into an agreement to be recapitalized by Blackstone.  Carlyle and its co-investors and the management and employees of Service King, which first invested in the company in August 2012, will retain a significant minority stake in the company. The transaction is expected to close during the third quarter.

Service King is one of the largest multi-shop operators of collision repair facilities in the country with 177 locations across 20 states.  Service King was founded in 1976 and is headquartered in Dallas (www.serviceking.com).

peter wallace nf2“We are excited to invest in Service King – an industry leader with an unparalleled commitment to its customers and focus on high quality service. We look forward to partnering with management, the company’s employee-owners, and Carlyle to support Service King’s continued growth and expansion,” said Peter Wallace, Blackstone Senior Managing Director.

Blackstone is one of the world’s leading investment and advisory firms. The firm’s alternative asset management businesses include the management of private equity funds, real estate funds, hedge fund solutions, credit-focused funds and closed-end funds. Blackstone also provides various financial advisory services, including financial and strategic advisory, restructuring and reorganization advisory and fund placement services. Blackstone is headquartered in New York (www.blackstone.com).

shary nf1“In a fragmented industry, Service King has grown tremendously and Carlyle is proud to have supported their achievements. We will continue to support Service King’s business and growth strategy and we are pleased with the successes we have achieved together thus far during Carlyle’s investment period,” said Shary Moalemzadeh, Carlyle Managing Director and Co-Head of Carlyle Strategic Partners.

The Carlyle Group invests in buyouts, growth capital, real estate and leveraged finance in Africa, Asia, Australia, Europe, North America and South America. Carlyle has expertise in various industries, including: aerospace, defense & government services, consumer & retail, energy, financial services, healthcare, industrial, real estate, technology & business services, telecommunications & media and transportation.  The firm employs approximately 1,600 people in 38 offices across six continents and is based in Washington, DC (www.carlyle.com).

Equity for Carlyle’s August 2012 investment in Service King came from the $1.1 billion Carlyle US Equity Opportunity Fund and the $700 million Carlyle Strategic Partners Fund III LP.

“We are grateful for our partnership with the skilled and knowledgeable teams at the Carlyle US Equity Opportunity Fund and Carlyle Strategic Partners,” said Chris Abraham, Service King’s Chief Executive Officer. “Service King’s recent growth is an example of Carlyle’s long-term approach to value creation and we look forward to working with our new partners at Blackstone to continue executing on our strategy.”

2014 PEPD • Private Equity’s Leading News Magazine • 7-23-14

Baring Acquires Cath Kidston from TA Associates

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kidson nf1Baring Private Equity Asia has acquired a substantial stake in UK-based lifestyle brand company, Cath Kidston, from its existing majority shareholder TA Associates and members of the company’s management team.  Baring Asia will have equal ownership with TA, and will partner with TA and the current management team to expand the brand and further develop its network in Asia. TA Associates first invested in Cath Kidston in 2010.

Cath Kidston is a lifestyle brand offering a range of products from accessories and womenswear to childrenswear and home furnishings. The company has stores in China, France, Hong Kong, Indonesia, Japan, Korea, Malaysia, Singapore, Spain, Taiwan, Thailand and the UK.  In July 2014, Cath Kidston opened its 100th overseas store in Seoul, South Korea, bringing the total number of stores to 166.  For the year ended March 30, 2014 the company’s sales increased 10% to £116 million with EBITDA rising 19% to £25 million.  International retail sales increased 37% to £46 million.  Cath Kidston was founded in 1993 and is headquartered in London (www.cathkidston.co.uk).

chen nf1“Cath Kidston is an established and profitable brand and, with strong underlying trends in consumer demand across Asia, we look forward to further developing the brand across the region,” said Dar Chen, a Managing Director at Baring Asia.  “We believe that cross border transactions of this nature will increasingly enable Baring Asia to demonstrate the value that our pan-Asia network and hands-on operational experience can bring to Western corporations looking to develop their business in the region.”

parkin nf1“We have enjoyed partnering with Cath Kidston over the past four years and assisting with their international growth. We welcome Baring Asia as a new investor and look forward to working closely with them and management as Cath Kidston continues its international expansion,” said Christopher Parkin, a Managing Director at TA Associates.

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 431 companies globally and has raised more than $18 billion in capital. The firm has offices in Boston, Menlo Park, London, Mumbai and Hong Kong (www.ta.com).

Baring Private Equity Asia advises funds that manage more than $5 billion in committed capital. The firm runs a pan-Asian investment program, specializing in mid-cap buyouts and providing growth capital to companies for expansion or acquisitions. Baring Asia currently has over 30 portfolio companies across Asia with 95,000 employees and revenues of over $25 billion.  The firm has been investing in Asia since its formation in 1997 and has approximately 100 employees located in Hong Kong, Shanghai, Beijing, Mumbai, Singapore, Jakarta and Tokyo (www.bpeasia.com).

“Finding the right partner to help us manage the development of the Cath Kidston brand in Asia was a key consideration for us and I am delighted that Baring Asia has invested in the future of our business,” said Kenny Wilson, CEO at Cath Kidston.  “Their support and operational experience will be invaluable as we expand further in the region. And with the continued backing from TA Associates we now have an even greater opportunity to build on the enormous appeal of the Cath Kidston brand internationally.”

UBS acted as exclusive financial advisor to TA Associates and Cath Kidston on this transaction.

2014 PEPD • Private Equity’s Leading News Magazine • 7-23-14

Huron Capital Partners Acquires Bandit

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bandit nf1Huron Capital Partners and Bandit Industries have entered into an agreement to recapitalize Bandit and to provide resources and capital to support the company’s growth. The investment is expected to close in early fall 2014.

Bandit Industries is a designer, manufacturer, distributor and servicer of hand-fed and whole tree wood chippers, stump grinders, forestry mowers, Beast recycling machines and other specialty wood and waste processing equipment. Bandit serves professionals in the logging, forestry, tree care, land clearing, recycling, and renewable energy markets through a global dealer network of over 160 locations.  The company was founded in 1983 and is based just outside Mount Pleasant in Remus, MI (www.banditchippers.com).

beauregard nf2“Bandit’s history as an independent, family-run business is an important criteria for us,” said Mike Beauregard, senior partner at Huron Capital. “Our investment in the business will preserve the legacy and culture of this business while continuing to expand globally under the Bandit brand. The business will remain a private, Michigan-based company funded with Michigan-based capital and employing Michigan-based people.”

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).

Jerry Morey will continue to run Bandit Industries as President & CEO.  Upon closing, a CEO succession plan will be initiated to recruit and train a new executive to lead the business into its next phase of growth.  Mike Morey Sr. and Dianne Morey will remain with the company in consulting roles.  Bandit will be co-owned by Jerry Morey, Mike Morey, Diane Morey and Huron Capital.

“When we announced last year that we were looking at companies for a potential sale or merger of Bandit, we were adamant that it had to be the right fit for our company, our community, our dealer network, and most importantly, our employees,” said Bandit Industries President Jerry Morey. “We were only interested in partnering with an organization that would respect and be committed to our company culture, from our employees in Michigan to our dealers operating all around the world. Huron Capital has a long history of growing companies while maintaining their independent operations and unique company culture, and that was a significant factor in our decision to partner with the firm. It also feels good to be working with another Michigan-based company that understands our challenges and shares our hometown pride. We are very much looking forward to the future for both Bandit and our mid-Michigan community.”

2014 PEPD • Private Equity’s Leading News Magazine • 7-23-14

GenNx360 Invests in Tooling Technology

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tooling btech nf1GenNx360 Capital Partners has made an investment in Tooling Technology, a manufacturer of tooling and automation systems. This transaction represents the third investment for GenNx360 Capital Partners’ Fund II.

Tooling Technology is a manufacturer of tooling and automation systems utilizing thermoforming, twin-sheet and single-sheet vacuum forming, pressure forming, compression molding, rotational molding, blow molding, resin transfer molding, rubber and polyurethane molding, carpet and metal stamping, foundry tooling and pulp molding.  The company sells its products to companies in the industrial machinery and components, oil and gas, logistics and supply chain management, agricultural, specialty chemicals, and aerospace sectors.  Tooling Technology is fully integrated with design, pattern-making, prototyping, machining, casting and finishing capabilities. The company employs approximately 100 people and has production facilities in Fort Loramie and Fremont, OH and an engineering design facility in Grand Rapids, MI.  Tooling Technology was founded in 1982 and is headquartered north of Dayton in Fort Loramie, OH (www.toolingtechonline.com).

guenther nf1“We strongly believe in the megatrends that drive Tooling Tech’s business. Re-shoring of industrial manufacturing to the US and strong automotive trends will continue to drive industry growth,” says Matt Guenther, the GenNx360 Partner who led the transaction.  “With its multiple processing capabilities, excellent track record and customer responsiveness, Tooling Tech is well positioned to benefit from continuing market demand. We expect to build on Tooling Tech’s strengths by leveraging our operational expertise and executing on identified opportunities, both organically and through add-on acquisitions.”

GenNx360 Capital Partners is a private equity firm focused on investing in industrial business-to-business companies in the middle market. Sectors of interest include industrial machinery and components, oil and gas, logistics and supply chain management, agricultural, specialty chemicals, and aerospace sectors.  GenNx360 was founded in 2006 and is headquartered in New York with additional offices in Seattle and Boston (www.gennx360.com).

“As we enter our next phase of growth, we are extremely excited to partner with GenNx360. Its significant experience in growing companies, its industry relationships and deep operational expertise will help us immensely in our continued growth efforts,” said Tooling Technology’s Founder and CEO, Tony Seger.

2014 PEPD • Private Equity’s Leading News Magazine • 7-23-14

Levine Leichtman Acquires Fastsigns

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fastsigns nf1Levine Leichtman Capital Partners (LLCP) has partnered with management to complete the acquisition of Fastsigns International, a franchisor of custom sign and graphics stores.  Fastsigns is the fourth investment from Levine Leichtman Capital Partners V, LP.

Fastsigns is the franchisor of Fastsigns centers which provide a full range of custom sign and graphics products to companies and individuals who want to outsource their signage needs.  There are currently more than 550 Fastsigns retail locations worldwide in the United States, Canada, the UK, Brazil, the Cayman Islands, Mexico and Australia.  Fastsigns was founded in 1985 and is headquartered north of Dallas in Carrollton, TX (www.fastsigns.com).

Lauren Leichtman nf“We couldn’t be more excited to partner with Catherine Monson who has driven strong performance and solidified Fastsigns’ position as the market leader since joining as CEO in 2009,” said Lauren Leichtman, Co-Founder and CEO of LLCP.  “The company’s growth prospects and strong cash flow characteristics resemble those of past successful LLCP franchise investments, and we look forward to our partnership with the company to generate another great outcome.”

Levine Leichtman manages approximately $7 billion of capital through private equity partnerships, distressed debt and leveraged loan funds. The firm is currently making new investments through Levine Leichtman Capital Partners V, LP; Levine Leichtman Capital Partners SBIC Fund, LP; and Levine Leichtman Capital Partners Private Capital Solutions II, LP. The firm is based in Los Angeles with offices in Chicago, Dallas, New York and London (www.llcp.com).

“Having a partner that understands franchising and the importance of providing valuable support to franchisees was critical to us in selecting our next financial partner.  The deep experience LLCP has investing in franchise businesses inspired great confidence among my management team that they are the right partner to support our continued growth,” said Ms. Monson.

North Point Advisors (www.nptadvisors.com), a San Francisco based investment bank, advised Fastsigns on this transaction.

2014 PEPD • Private Equity’s Leading News Magazine • 7-23-14

Succession Capital Acquires H.J. Sherman Company

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sherman nf1Succession Capital has acquired H.J. Sherman Company, a designer, manufacturer and distributor of religious gifts and jewelry.

“H.J. Sherman is a household name in the religious gifts industry. That takes decades to build, and they’ve done it the right way,” said Succession’s Managing Partner Nathaniel Broughton.  “We’re honored to be able to join in continuing the Sherman legacy. The company has remained a major player by focusing on service and innovation in its products, while always carrying the staples. Expect that to continue.”

H.J. Sherman is a designer, manufacturer and distributor of religious gifts and jewelry. The company sells its products through non-company retail stores and other qualified resellers. H.J. Sherman has been family-owned since its founding in 1948 and is based in Van Nuys, CA (www.hjsherman.com).

Succession Capital, a subsidiary of Lynx Equity Limited, seeks to acquire small to medium-sized businesses from owners looking to retire.  Succession targets transactions requiring between $2 million and $8 million of equity. H.J. Sherman is Succession Capital’s and Lynx’s 10th acquisition of 2014 and joins the group’s portfolio of over thirty-five companies including jewelry manufacturer JewelPop (www.jewelpop.com).  Succession Capital is based in La Jolla, CA (www.succession-capital.com).

2014 PEPD • Private Equity’s Leading News Magazine • 7-23-14

Abacus Backs Latest Buy of Wafra Partners

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abacus nf2Abacus Finance Group was the Administrative Agent and Sole Lead Arranger for $19 million in senior secured credit facilities to support the acquisition of Atronix, a provider of cable assemblies, by Wafra Partners. Abacus team members involved in the transaction included Timothy Wong and Eric Petersen.

Atronix is a provider of cable assemblies, wire harnesses and electromagnetic assemblies to a diverse group of end markets.  Products include internal and external inter-connect cabling; wire harnesses; power cords and cable assemblies; jumper wires and interconnects; coaxial cable assemblies; triaxial cable assemblies; and custom wire pigtails and extensions.  Atronix has facilities in Billerica, MA; Tucson, AZ; and Nogales, Sonora, Mexico; and partner production facilities in China. The company was founded in 1980 and is based northwest of Boston in Billerica, MA (www.atronix.com).

clifford nf1“Our previous experience investing in the wire, cable and harness space aligned well with Wafra’s needs in the Atronix transaction,” said Tim Clifford, President and CEO of Abacus Finance. “A smooth due diligence process, certainty of close, and flexibility in structuring – key principles of the Abacus Finance Total Partnership Approach – are all the reasons why private equity sponsors choose Abacus as a trusted lending partner.”

Abacus targets debt financing opportunities of up to $50 million with a typical hold size ranging from $10 million to $25 million. The companies that Abacus finances generally have EBITDAs between $3 million and $15 million. Abacus was formed in June 2011 and is an affiliate of New York Private Bank & Trust, the holding company for Emigrant Bank, founded in 1850, the largest privately held bank in America with approximately $10 billion in assets. Abacus is based in New York (www.abacusfinance.com).

“We are thrilled with the success of the first transaction between Wafra and Abacus Finance,” said Wafra Managing Director Ryan Wierck, “and were impressed with Abacus’ expertise, enthusiasm and ability to complete the transaction quickly.”

Wafra invests up to $30 million of equity per transaction in middle market companies based in North America that have enterprise values between $20 million and $150 million. Typical investments have revenue of $20 million or more and EBITDA of $4 million or more. Sectors of interest include consumer products, outsourced business services, niche manufacturing, and consumer-driven services. The firm is based in New York (www.wafrapartners.com).

Northstar Mezzanine (www.northstarcapital.com) provided the mezzanine financing for this transaction.

2014 PEPD • Private Equity’s Leading News Magazine • 7-23-14

Arsenal Adds New Investor Relations Pro

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grace rhee kim nf1Arsenal Capital Partners has appointed Grace Rhee Kim as a Principal in Investor Relations.

Ms. Kim was formerly a Principal of Business Development at Providence Equity Partners. Prior to Providence Equity, she was a Managing Director in the Private Funds Group at Forbes Private Capital Group. Ms. Kim also worked as a Managing Director for Guggenheim Partners and as a Portfolio Manager for JP Morgan’s Private Equity Group. Ms. Kim received her MBA from Columbia Business School and her BA in Economics from Columbia University.

“Grace brings significant experience to Arsenal’s Investor Relations program, and will assist us in continuing to advance our ability to serve our investors.  Arsenal and Grace have worked together for a number of years spanning her tenure at JP Morgan, Guggenheim Partners, and Forbes Private Capital.  She is a good fit with Arsenal’s culture and has strong relationships with many of Arsenal’s existing investors,” said Bill Farrell, Arsenal’s Head of Investor Relations.

Arsenal Capital Partners invests in middle-market specialty industrial and healthcare companies that have $50 million to $250 million in enterprise value. Industries of specific interest include specialty & fine chemicals; segments of healthcare; transportation and logistics; power generation; aerospace & defense; and process industry components and services. Arsenal has $1.7 billion of committed capital under management. The firm was founded in 2000 and has offices in New York and Shanghai (www.arsenalcapital.com).

2014 PEPD • Private Equity’s Leading News Magazine • 7-23-14

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