February 25, 2015
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Archives for February 25, 2015

Hanesbrands to Acquire Merit Portfolio Company

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knights nf1Knights Apparel, a seller of licensed collegiate apparel and a portfolio company of Merit Capital Partners, has entered into an agreement to be acquired by Hanesbrands for approximately $200 million.

The transaction will combine Knights Apparel, a seller of licensed collegiate apparel primarily for the mass retail channel, with Hanesbrands (NYSE: HBI), a seller of licensed collegiate apparel in university bookstores.  The transaction is expected to close early in the second quarter of 2015.

Knights Apparel was acquired by Merit in July 2011 and is a licensee for colleges and universities as well as the National Hockey League. The company’s products are sold primarily through big box retailers and include t-shirts, fleeces and polos, for men, women, and youth/infant/toddler consumers. Knights Apparel has annual sales of about $180 million and is headquartered in Spartanburg, SC (www.knightsapparel.com).

Knights Apparel’s Alta Gracia business subsidiary, a fair trade/socially-conscious clothing brand, will not be a part of the transaction and will remain independent. Alta Gracia will be a stand-alone entity owned by certain members of the current Knights Apparel ownership group. “Our goal has always been to give Alta Gracia an opportunity to become an independent and sustainable business,” said Donnie Hodge, President of Knights Apparel. “Because of the partnership and support we continue to receive from our university and retail partners, we believe Alta Gracia is well positioned for growth in the market for ethically responsible products.”

Merit Capital Partners invests mezzanine and equity capital of $15 million to $60 million in companies with at least $5 million of EBITDA that are active in the manufacturing, distribution and services industries.  The firm was founded in 1993 and is based in Chicago (www.meritcapital.com).

Guggenheim Securities (www.guggenheimpartners.com) was the exclusive financial advisor to Knights Apparel and Vedder Price served as legal counsel.

© 2015 PEPD • Private Equity’s Leading News Magazine • 2-25-15

Solis Acquires ICOM North America

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icom nf1Solis Capital Partners has invested in ICOM North America, a manufacturer of liquid and direct-injection propane autogas fueling systems for fleet and commercial vehicles. The purchase of ICOM is the sixth investment made by Solis II, LP, a $61 million fund raised in 2013.

ICOM develops, assembles and integrates propane liquid injection fuel systems, as well as toroidal and cylindrical fuel tanks. ICOM’s propane liquid injection technology is used to power certain Chevrolet, Ford, GM, GMC and Lincoln vehicles and has EPA certification for over 700 vehicle platforms.  ICOM was founded in 2004 and is headquartered northwest of Detroit in New Hudson, MI (www.icomnorthamerica.com).

craig dupper nf1“ICOM’s next generation, patent protected technology makes it the clear leader in this alternative energy segment. Propane autogas is made in America, abundantly available, less expensive and is an environmentally clean fuel,” said Craig Dupper, Managing Partner of Solis.  “We’re excited to partner with the ICOM team as they build on their successful track record and accelerate the company’s growth.”

Solis Capital Partners invests from $2 million to $25 million in companies with revenues between $15 million and $100 million that operate in the business services, niche manufacturing, and software sectors. Target companies are typically headquartered in the Western United States. Solis is actively investing through Solis Capital Partners II which closed in May 2013.  The firm has offices in Newport Beach and San Diego (www.soliscapital.com).

“Solis is a valuable strategic and financial partner,” said Ralph Perpetuini, CEO of ICOM, “We are excited to have their insight and support as we expand ICOM’s footprint in the North American market.”

© 2015 PEPD • Private Equity’s Leading News Magazine • 2-25-15

LBC Credit Backs Latest RLJ Equity Acquisition

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LBC nf1Middle-market lender LBC Credit Partners has provided acquisition financing to back RLJ Equity Partners’ purchase of Phase One Consulting Group, a provider of information technology-based consulting services to US federal civilian agencies.

Phase One’s specialties include IT strategy, organizational transformation, strategic communications, process and business analysis, investment management, solution architecture, solution engineering, and cybersecurity.  The company was founded in 1997 and is headquartered in Alexandria, VA (www.pocg.com).

RLJ Equity Partners invests from $15 million to $30 million in companies valued between $50 million and $250 million. Target companies will have operating profits greater than $7 million and operating margins greater than 10%.  Sectors of interest include aerospace & defense; auto & transportation; business services; consumer retail; general industrial; and media & telecom.  RLJ Equity Partners was founded in 2006 by Robert L. Johnson in partnership with The Carlyle Group. The firm is headquartered in Bethesda, MD (www.rljequitypartners.com).

Mezzanine debt financing was provided by Enlightenment Capital (www.enlightencap.com) an aerospace, defense, and government focused investment firm based in the Washington, DC area. LBC Credit Partners and Enlightenment Capital also provided equity-co-investments to support the acquisition.

LBC Credit Partners is a provider of middle market financing to companies with EBITDAs generally greater than $10 million. Products include senior term, unitranche, second lien, junior secured and mezzanine debt and equity co-investments supporting sponsored and non-sponsored transactions. LBC invests from $10 million to $50 million per transaction supporting acquisitions, growth strategies, refinancings, recapitalizations, and restructurings. LBC has more than $1.75 billion of capital commitments and is headquartered in Philadelphia with additional offices in Chicago and Greenwich (www.lbccredit.com).

© 2015 PEPD • Private Equity’s Leading News Magazine • 2-25-15

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