The Beekman Group has acquired Direct Connect Holdings, a provider of credit and debit card payment processing services, in partnership with Matt Clyne, the company’s president and chief executive officer.
“Our interest in merchant service providers began a year ago and our search focused on businesses that were capitalizing on several exciting and value-added trends within the payment industry,” said John Troiano, Beekman’s Managing Partner. “Matt Clyne has surrounded himself with experienced management team members, many of whom have worked together for several years prior to joining Direct Connect, and have executed on high-value growth strategies across the industry.”
The Beekman Group makes control investments from $5 million to $25 million in privately held companies, family businesses in transition, operating divisions of large companies or small public companies looking to privatize. Typical acquisitions have revenues from $10 million to $200 million and enterprise values of $15 million to $75 million. The Beekman Group was founded in 2004 and is based in New York (www.thebeekmangroup.com).
Direct Connect represents the final investment for Beekman’s second fund which closed in December 2012 with $100 million in commitments. The fund is composed of eight platform investments. Just last month, Beekman closed its oversubscribed third lower middle-market fund at its hard cap of $230 million.
Direct Connect provides check and payment card acceptance and processing services across a range of formats, including credit, debit, gift, stored value and electronic benefit transfer. The company’s service and product offerings includes mobile and website acceptance; virtual terminals for mail and telephone order processing; secure and compliant point-of-sale equipment; cash advance funding programs; terminal sales/leases and deployment; full customer, tech and merchant support; chargeback resolution; and payment card industry security compliance. Customers include brick-n-mortar retail stores, direct mail and phone order operations, government contractors, service industries, and software developers. Direct Connect is headquartered west of Arlington in Chantilly, VA (www.directconnectps.com).
“I am excited to have found a growth oriented partner with values that are consistent with our own and a commitment to accelerating Direct Connect’s growth to meet the potential to which the company aspires,” said Mr. Clyne, who has led Direct Connect since 2009. “The Beekman team’s experience in building lower middle-market companies and more specifically their experience supporting its portfolio companies’ acquisition strategies, with both capital and expertise, made them the best fit to maximize our growth potential.”
Direct Connect’s debt financing was led by Goldman Sachs Specialty Lending Group, which has partnered with Beekman in financing other portfolio companies.
© 2015 PEPD • Private Equity’s Leading News Magazine • 1-22-15