Philadelphia-based LBC Credit Partners provided a $97 million senior secured credit facility to back the June 2015 merger of two of Monomoy Capital Partners’ portfolio companies – Escort Inc. and Cobra Electronics Corp. – to form Cedar Electronics Holdings Corp. The merger and the financing from LBC allowed for a $41 million dividend payment to be made to Monomoy Capital Partners II, LP and other investors.
The combination of Escort and Cobra creates a sizable branded consumer electronics company whose products are used by casual and professional drivers, boat owners and outdoor enthusiasts. Cedar will continue to market its products under the Cobra, Escort, Passport and Beltronics brands and will focus on six core product categories: radar detection (Cedar is the industry leader in the radar detection market at every price point and in every sales channel); citizen band radios; marine radios; and two-way radios dash cams.
The combined businesses – under the Cedar Electronics umbrella – are now based at Escort’s headquarters in West Chester, OH and have approximately 350 employees. David Thornhill, formerly the senior executive of Escort, is now the Chief Executive Officer of Cedar. Sally Washlow, formerly the senior executive of Cobra, is now the President of Cedar.
LBC, the agent and sole lead arranger for this transaction, 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. The lender is headquartered in Philadelphia with additional offices in Chicago and Greenwich (www.lbccredit.com).
In addition to the LBC senior facility, a mezzanine loan was provided by Charlotte-based Capitala Investment Advisors (www.capitalagroup.com) to finance the dividend recap.
Monomoy Capital Partners makes control investments in middle market businesses with $50 million to $500 million in annual sales. Sectors of interest include manufacturing, distribution, consumer product and foodservice industries. The firm has $700 million in assets under management and is headquartered in New York (www.mcpfunds.com).
This dividend recapitalization is the twelfth liquidity event for Monomoy Capital Partners II, LP, a 2011 vintage private equity fund.
© 2015 PEPD • Private Equity’s Leading News Magazine • 7-29-15