Archives for May 14, 2015

Linsalata Acquires RANDYS Worldwide Automotive

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Linsalata Capital Partners has acquired a majority interest in RWA Holding Company and its subsidiary Ring & Pinion Service (DBA RANDYS Worldwide Automotive).  RANDYS’ CEO, Kevin Kaestner, co-invested in the transaction alongside Linsalata Capital Partners.

The acquisition of RANDYS is the fourth platform investment for Linsalata Capital Partners Fund VI, LP, a $427 million fund raised in August 2012.

“RANDYS is our latest portfolio company investment in the automotive aftermarket sector having previously invested in Transtar Industries, Lund International and Highland Group Industries,” said Michael Faremouth, Managing Director at Linsalata Capital Partners and a leader of the firm’s automotive aftermarket practice. “RANDYS’ strong brands and value proposition have it well positioned to capitalize on the long term growth dynamics in the industry”.

RANDYS is a provider of engineered components such as differentials, ring & pinion and axle products that are used to improve the towing and traction performance of a vehicle.  The company sells over 6,000 SKU’s under the Yukon and USA Standard brands to a customer base of 20,000 installers, distributors and retailers serving the repair, off-road and performance segments. RANDYS was founded by Randal Lyman in 1982 and is headquartered in Everett, WA (www.ringpinion.com).

“RANDYS is an exciting company with strong brands, multiple organic growth initiatives and add-on acquisition candidates and we are anxious to work with Kevin Kaestner and the team to realize these opportunities,” said James Guddy, Vice President at Linsalata Capital Partners.

Linsalata Capital Partners invests from $10 million to $50 million of equity in middle market companies that have $7 million to $50 million of EBITDA and at least $300 million in enterprise value.  The firm was founded in 1984 and is based near Cleveland in Mayfield Heights, OH (www.linsalatacapital.com).

2015 PEPD • Private Equity’s Leading News Magazine • 5-14-15

Roark Acquires Pet Supermarket

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Roark Capital Group has acquired Pet Supermarket, a pet specialty retailer, from Charles West, Jr., the company’s founder.  Pet Supermarket will remain headquartered in Sunrise, FL, and continue to be led by Diane Holtz, its Chief Executive Officer. Pet Supermarket is Roark’s fourth investment in the pet specialty sector.

Pet Supermarket operates 155 pet specialty retail stores in 11 states and generates approximately $300 million of annual revenue.  The company has more than 10,000 SKU’s and sells premium and holistic pet food and a wide variety of pet supplies for dogs, cats, birds, fish, reptiles and other small critters like gerbils and hamsters. The company was founded in 1973 as Pet Circus and was renamed Pet Supermarket in 1986 (www.petsupermarket.com).

“We are pleased to welcome Pet Supermarket to the Roark family,” said Ezra Field, Managing Director of Roark Capital.  “Diane and her team operate a terrific pet specialty chain with friendly, knowledgeable staff that is clearly committed to customer service.”

“We are excited to have Roark as our growth partner,” said Ms. Holtz.  “Roark brings to us incredible resources, consumer retail knowledge, and a collaborative approach to working with its portfolio companies that will enable us to accelerate Pet Supermarket’s growth.”

Financing for the transaction was arranged by Golub Capital.  Pet Supermarket was advised by Houlihan Lokey.

Roark Capital Group invests in consumer and business services companies, with a focus on the franchise, food and restaurant, specialty retail, environmental services, waste management, and marketing services sectors. In December 2014, Roark held a final close of Roark Capital Partners IV LP at its hard cap of $2.5 billion.  Since founding in 2001, Roark has raised over $6 billion of equity capital commitments.  The firm, headquartered in Atlanta, takes its name from Howard Roark, the protagonist in Ayn Rand’s “The Fountainhead” (www.roarkcapital.com).

2015 PEPD • Private Equity’s Leading News Magazine • 5-14-15

Mainsail Invests in Ncontracts

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Mainsail Partners has made an investment in Ncontracts, a provider of vendor compliance and contract management software and services.  Ncontracts will use the growth capital investment from Mainsail to grow its product development, compliance services, and sales and marketing teams, as well as to pursue potential acquisitions.

Ncontracts products are used primarily by financial institutions – banks and credit unions – to maintain information on vendor contracts and to provide alert notifications that allow for proactive management of the vendor relationship. Ncontracts was founded in 2009 and is headquartered south of Nashville in Brentwood, TN (www.ncontracts.com).

“Ncontracts’ software and compliance services are guided by an exceptional executive leadership team. The company has proven it is a trusted partner of bank and credit union executives throughout the country,” said Stephen Wolfe, a partner at Mainsail Partners.

Mainsail Partners invests from $5 million to $25 million in US and Canadian companies that have revenue of $4 million to $50 million. Sectors of interest include software and software as a service (SaaS); technology-enabled business services; E-commerce and Internet; financial technology and services; healthcare IT and services; and franchising business models.  The firm was founded by Gavin Turner and Jason Payne in 2003 and is based in San Francisco (www.mainsailpartners.com).

“We are very pleased to announce this important milestone in our company’s growth plan,” said CEO and Founder Michael Berman.  “Vendor management and compliance are hot button issues, especially for financial institutions.  Organizations need to manage new and changing risks arising from constantly evolving regulations and emerging technologies and services. The combination of Mainsail’s company-building experience and the infusion of growth capital will allow us to accelerate innovation, continue to deliver best-in-class products and services for our customers, and power the next phase of growth for Ncontracts.”

Ncontracts marks Mainsail’s second investment in the greater Nashville metropolitan area in the last year.  In October 2014 Mainsail invested in Playmaker CRM, a cloud-based customer relationship management provider used by post-acute care companies.  Playmaker is based in Franklin, TN.

2015 PEPD • Private Equity’s Leading News Magazine • 5-14-15

FGI Launches New Private Equity Group

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Commercial finance company FGI is wading into the private equity space with the launch of FGI Equity. Harriette Terbell has joined FGI Equity as its managing partner and will lead the new group.

FGI Equity will make minority and majority investments in middle-market companies through both direct investments and partnerships. Target companies will be cash flow positive and profitable and have at least $50 million of revenue.  Sectors of interest include consumer products, retail, financial services, healthcare, manufacturing, and cyber security.

“Partnering with FGI is a tremendous opportunity,” said Ms. Terbell. “I am thrilled to work closely with FGI’s globally recognized financial services and leadership team.”

Ms. Terbell is the founder of private equity and advisory firm Terbell Partners and previously was a general partner in Alsacia Venture Investments, a venture capital fund that commercialized pre-seed, seed, and early stage medical device and healthcare related investments. Previously, she was a partner with strategic management consulting firm, The Hay Group and an officer at Fleet Financial.

“We’ve worked with Harriette on many ventures over the years,” said David DiPiero, President and CEO of FGI. “I am thrilled Harriette has now formally joined FGI to lead and grow this important initiative.”

FGI is a New York-based commercial finance company that invests in small and medium-sized companies.  The company was co-founded by Mr. DiPiero in 2000 and has additional offices in Miami, Chicago, Atlanta, Los Angeles, Toronto and London (www.FGIWW.com).

2015 PEPD • Private Equity’s Leading News Magazine • 5-14-15

Monomoy Launches Debt-for-Control Strategy

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Monomoy Capital Partners has hired David Robbins as Managing Director and the Head of Credit Strategies.  Mr. Robbins will oversee the firm’s investments in the debt securities of distressed and underperforming businesses that can benefit from Monomoy’s operational, financial and strategic improvement practices.

“Monomoy stands out in our marketplace because it brings a talented investment group and a world class operating team to the middle market,” said Mr. Robbins. “Companies in the lower end of the middle market are often under-managed and over-leveraged, and a focused debt-for-control strategy will expand our ability to acquire those businesses at attractive valuations, improve their profitability and deliver outstanding returns.”

Mr. Robbins joins Monomoy from H.I.G. Bayside Capital where he was a Managing Director responsible for investments in distressed debt and positioning Bayside to take control of middle market companies through financial restructurings. Before Bayside, Mr. Robbins was a Senior Managing Director at GSC Group and the co-head of the GSC credit team that sourced and executed similar middle market investments. He began his career in the private equity practice of the Blackstone Group. Mr. Robbins holds a BS in Economics from the Wharton School of the University of Pennsylvania.

“We are thrilled to welcome David to the Monomoy team,” said Justin Hillenbrand, a founding partner of Monomoy. “We believe that the credit markets will provide attractive opportunities to acquire underperforming middle market businesses in the next business cycle, and David brings the perfect blend of talent, experience and judgment to position Monomoy for continued success in this core investment strategy.”

Monomoy Capital Partners was founded in 2005 by Stephen Presser, Daniel Collin and Justin Hillenbrand. Over the past ten years, Monomoy has acquired over 40 middle market companies from a variety of sellers (including family owners, public companies, lenders and financial sponsors) in a wide range of special situations (including bankruptcy, asset sales, equity sales and restructurings).  Target companies for Monomoy include middle market businesses with $100 million to $600 million in annual sales. Sectors of interest include manufacturing, distribution, consumer product and foodservice industries.  The firm has over $1 billion in committed capital and is headquartered in New York (www.mcpfunds.com).

2015 PEPD • Private Equity’s Leading News Magazine • 5-14-15

Monroe Backs Mud Pie Buyback

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Monroe Capital has provided a subordinated debt facility to Mud Pie, LLC to enable the company to repurchase the equity of the company owned by Lineage Capital. With the closing of this transaction, the equity of Mud Pie is now 100% owned by the founding Miller family.  Lineage Capital acquired its non-control equity position in Mud Pie in April 2010.

Mud Pie is a designer and manufacturer of giftware and decorative accessories. The company is comprised of 3 divisions – Mud Pie Baby, Mud Pie Living and Mud Pie Fashion – and its products are sold into the home, babies and toddlers, seasonal and holiday gifts, and fashion markets. Approximately 13,000 specialty retailers and department stores carry Mud Pie products which are also sold directly to consumers through the company’s website.  Mud Pie is headquartered east of Atlanta in Stone Mountain, GA and was founded in 1988 by its current CEO Marcia Miller (www.mud-pie.com).

In addition to being used to repurchase the equity stake from Lineage Capital, the Monroe Capital facility has additional availability to provide the resources to continue the growth of the Mud Pie brand.  For the past three years, Mud Pie was named as one of Georgia’s Fastest Growing Middle Market Companies by Georgia Trend magazine.  In 2011, Business to Business magazine selected Mud Pie as a “Top 300 Small Business of the South” and Mud Pie was named a “2012 Bulldog 100: Fastest Growing Bulldog Businesses” by the University of Georgia Alumni Association.

Monroe Capital provides senior and junior debt and equity co-investments to middle-market companies. The firm was founded in 2004 and maintains offices in Chicago, Atlanta, Boston, Charlotte, Dallas, Los Angeles, New York and San Francisco (www.monroecap.com).

2015 PEPD • Private Equity’s Leading News Magazine • 5-14-15