Archives for December 4, 2015

Silver Oak Sells Direct Travel to ABRY

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Silver Oak Services Partners has completed the sale of its equity interest in Direct Travel to ABRY Partners. Silver Oak made its original investment in Direct Travel in September 2011.

Direct Travel is a provider of corporate travel management services to mid- to large-sized corporate accounts. Services include booking and managing employee air travel, transportation and accommodations. Direct Travel is led by Ed Adams, CEO and has over 900 employees in 39 offices in 16 states. The company is headquartered in Denver (www.dt.com).

During Silver Oak’s term of ownership, Direct Travel completed 12 acquisitions which expanded the company nationally. To take advantage of its larger scale, Silver Oak worked with the management team to renegotiate supplier contracts, expand cross-selling services, and move toward a common IT platform.

“Silver Oak has been an excellent partner over the past four years,” said Mr. Adams. “The leadership team at Silver Oak provided us with tremendous advice, support and mentoring throughout our partnership. Under Silver Oak’s stewardship, Direct Travel enjoyed substantial growth.”

Silver Oak makes control investments of $10 million to $30 million in companies with revenues from $15 million to $150 million and EBITDAs from $3 million to $20 million. Sectors of interest include business, healthcare, and consumer services.  Silver Oak is based in the Chicago suburb of Evanston (www.silveroaksp.com).

ABRY Partners, the buyer of Direct Travel, invests in the media, communications, and business and information sectors. The firm is currently managing $4.3 billion of total capital and investing out of a $1.9 billion private equity fund, $950 million senior equity fund and a $1.5 billion senior debt fund. ABRY was founded in 1989 and is headquartered in Boston (www.abry.com).

William Blair & Company (www.williamblair.com) was the financial advisor to both Direct Travel and Silver Oak.

© 2015 PEPD • Private Equity’s Leading News Magazine • 12-4-15

Quad-C Sells Balboa Water Group to AEA

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Quad-C Management has sold Balboa Water Group, a manufacturer of components for the portable spa, and jetted bath markets, to AEA Investors.

Balboa Water Group (BWG) manufactures pumps; blowers; electronic control systems; jets; fittings, valves and drains (known as white goods in the industry); and other accessories for the leisure water industry. The company is headquartered south of Los Angeles in Tustin, CA and has facilities in Denmark, Belgium, China and Australia (www.balboawatergroup.com).

BWG was founded in June 2007 when Quad-C partnered with CEO Eric Kownacki and VP of Sales Jeff Christine – both were previously executives with Polaris Pool Systems, a former Quad-C portfolio company – to pursue a consolidation strategy in the leisure water sector. During the past eight years, BWG has completed five acquisitions and invested capital to improve its operating systems, develop new products, and expand into international markets.

“I have worked with Quad-C now for over 15 years and they have been great partners,” said Mr. Kownacki. “Throughout the duration of the investment in BWG, Quad-C supported our acquisition strategy and was willing to invest significant capital even in the depths of the recession to accomplish the strategic vision we set together in 2007. That commitment to the partnership was crucial and was paramount to our success and potential for continued growth in the future.”

Quad-C invests from $35 million to $125 million of equity in companies with enterprise values of $75 million to $400 million. Sectors of interest include business services, consumer, general industrial, healthcare, specialty distribution, and transportation & logistics.  Quad-C was founded in 1989 and is headquartered in Charlottesville, VA (www.quadcmanagement.com).

“When we invested in BWG, we saw an opportunity to consolidate the spa and bath components industry under the banner of an industry-leading brand powered by an exceptional management team,” said Thad Jones, Partner at Quad-C. “Despite the historic downturn in the market, we remained committed to the strategic vision and were able to take advantage of the distress in the market to pursue several follow-on acquisitions at attractive prices while also investing in new product development and expanding globally. Thanks to the dedication, execution and tenacity of the management team, BWG emerged from the recession with very strong sales growth and a robust new business pipeline.”

AEA, the buyer of Balboa Water Group, makes equity and debt investments in middle market companies that operate in the following sectors: retail and consumer products, services, specialty chemicals, and value-added industrial products. The firm manages approximately $9 billion of capital. AEA was founded in 1968 and is headquartered in New York (www.aeainvestors.com).

© 2015 PEPD • Private Equity’s Leading News Magazine • 12-4-15

Frontenac Acquires La Tavola Fine Linen

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The Frontenac Company has acquired La Tavola Fine Linen, a renter of premium and ultra-specialty linens used for weddings ceremonies, wedding receptions and other special events.

La Tavola’s products include aisle runners, napkins, table rounds and runners, chair covers and sashes, and drapes. The company has eight showrooms in California in Beverly Hills, Healdsburg, Napa (headquarters), Newport Beach, Sacramento, San Francisco, Santa Barbara, and Los Gatos, as well as showrooms in Scottsdale, AZ and Dallas, TX. The company was founded in 2007 by Herb and Betsy Stone (www.latavolalinen.com).

As part of this transaction, Frontenac has hired industry veteran Jeff Black as the company’s new chief executive officer. Herb and Betsy Stone will continue working with the company in consulting roles with Ms. Stone serving as Head of Design. Mr. Black was previously the CEO of Classic Party Rentals from March 2012 to November 2014 and was also a senior executive at Aramark responsible for outsourced operations, uniforms and linen, and customer service.

“As a leader in its market niche, La Tavola is a profitable, budding and attractive opportunity with significant growth potential,” said Paul Carbery, a Managing Partner at Frontenac. “With Jeff Black at the helm, we are confident the company will reach new levels of success. He is a collaborative leader who is passionate about this company, the team that makes it up, and the events industry as a whole.”

Joe Rondinelli, a Vice President at Frontenac, was also part of the transaction team. “La Tavola Fine Linen Rental has an exceptional reputation in the events industry and we are excited they chose to partner with Frontenac. We look forward to working with Jeff, Betsy, Herb and the entire team to open new showrooms and introduce new, high quality linens.”

Frontenac invests in lower middle markets businesses that operate primarily in the food, industrial, and services industries. The firm was founded in 1971 and is headquartered in Chicago (www.frontenac.com).

© 2015 PEPD • Private Equity’s Leading News Magazine • 12-4-15

Huron Sells Plastic Film Biz to Pamplona

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Huron Capital Partners has sold its portfolio company Bloomer Holdings to Charter NEX Films, a portfolio company of Pamplona Capital.

Bloomer (DBA Optimum Plastics) is a producer of engineered films for use in high performance industrial, medical and consumer end-markets. In October 2014, Bloomer acquired Optimum Plastics, a producer of high barrier coextruded blown plastic films.  The company’s products are engineered for specific customer needs and support a variety of material blends, colors, sizes, gauges and emboss patterns. Bloomer uses polyethylene, polypropylene and nylon to make films with a thickness of 0.75 to 40 mil (a mil is a thousandth of an inch), embossed thicknesses to 70 mil and widths from 1.5 to 88 inches. Bloomer and Optimum have facilities near Minneapolis in Bloomer, WI  (www.bloomerplastics.com) and near Columbus in Delaware, OH (www.optimumplastics.com).

Huron Capital acquired Bloomer in June 2012 and during its term of ownership revenue increased both organically and from add-on acquisitions from $45 million to over $100 million and the number of employees grew from 66 to 145.  The add-on acquisition of Optimum Plastics doubled the revenues of Bloomer and was the largest driver of revenue growth.

“With both cast embossed and blown film capabilities, we believe we have built Optimum into a major player in the custom films marketplace,” said Kevin Keneally, CEO.  “Huron Capital has been very supportive of our organic and acquisition-related growth initiatives. The firm supported significant investments in technology, capacity and business development resources, and they shared the management team’s vision of building a technically advanced, custom manufacturer with diverse product offerings.”

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 specialty manufacturing, business services, consumer goods & services, and healthcare.  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).

Charter NEX – the buyer of Bloomer – supplies flexible packaging converters with an array of products, from monolayer to high barrier films, that are used in the retail food, consumer products, industrial, and medical markets. The company was acquired by Pamplona Capital in February 2015. Charter NEX has three facilities in Wisconsin and one in Massachusetts and is headquartered south of Madison in Milton, WI (www.charternex.com).

Pamplona Capital makes private equity, fund of hedge funds and single manager hedge fund investments.  The firm is currently investing Pamplona Capital Partners IV LP, a €3 billion fund raised in 2014. Pamplona was founded in 2005 and is based in London and New York (www.pamplonafunds.com).

Charter NEX financed the acquisition through a combination of cash on hand and credit facilities arranged by Guggenheim Corporate Funding (www.guggenheimpartners.com). Charter NEX was advised in the transaction by Houlihan Lokey Capital (www.hl.com) with Hogan Lovells (www.hoganlovells.com) acting as legal counsel. Optimum Plastics was advised in the transaction by Mesirow Financial (www.mesirowfinancial.com) with Honigman Miller Schwartz and Cohn (www.honigman.com) acting as legal counsel.

© 2015 PEPD • Private Equity’s Leading News Magazine • 12-4-15

Riverside Sells Brandmuscle to American Capital

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The Riverside Company has sold Brandmuscle, a provider of local marketing technology and services, to American Capital. The acquisition was financed with equity from American Capital Equity III, LP, a $1.1 billion private equity fund raised in 2014.

Brandmuscle is an advertising and marketing agency that provides software and services that enable brands with distributed sales and marketing channels to create and execute local marketing campaigns across all mediums and formats. The company is led by its CEO Philip Alexander and has approximately 650 employees. Brandmuscle has offices in Chicago, Cleveland, Austin and Newark (www.brandmuscle.com).

Riverside first invested in Brandmuscle in 2011 – the investment was originally known as Centiv Services – and completed the add-on acquisitions of TradeOne Marketing and Brandmuscle, with the combined entity adopting the new name. “Brandmuscle provides a compelling and valuable service, and we’re delighted to have greatly extended its reach during our hold period,” said Riverside Managing Partner Loren Schlachet. “We were able to build on a strong company and grow it both organically and through add-on acquisitions.”

“We were able to greatly expand the customer base and broaden Brandmuscle’s capabilities, which allowed us to deliver more value to our clients,” said Riverside Vice President Brad Resnick. “Brandmuscle has a strong management team who shared our vision and executed that vision ably over the past four years.”

The Riverside Company invests in businesses valued at up to $300 million (€200 million in Europe). Since its founding in 1988, Riverside has invested in more than 380 transactions. The firm’s international portfolio includes more than 70 companies. Riverside is headquartered in New York with additional offices in Atlanta, Chicago, Cleveland, Dallas, Los Angeles, San Francisco, and London (www.riversidecompany.com). Working with Mr. Schlachet and Mr. Resnick on the transaction for Riverside were Partner Alan Peyrat, Operating Partner Rex Niles, Associate Jason Thorn and Finance Director Mike Rath. Riverside Origination Principal Amy Margolis helped facilitate the exit.

American Capital Equity (ACE) is led by partners Justin DuFour, Sean Eagle, Eugene Krichevsky and David Steinglass, and invests between $25 million and $150 million of equity per transaction in the business services, healthcare products and services, and industrial growth end markets.  Typical acquisitions have recurring revenue and EBITDA between $5 million and $25 million.

“Brandmuscle fits very well within ACE’s technology-enabled business services vertical, providing its clients with a wide range of services that facilitate localized marketing by their local affiliates,” said Mr. Krichevsky.

The ACE investor group, led by funds advised by Coller Capital, Goldman Sachs Asset Management and StepStone Group, also includes select sovereign wealth funds, state retirement and pension systems, high net worth family offices, superannuation funds and foundations.  ACE is managed by a subsidiary of American Capital Asset Management which is wholly owned by American Capital. ACE is headquartered in Bethesda (www.acequity.com).

Lincoln International (www.lincolninternational.com), TM Capital (www.tmcapital.com), Deloitte (www.deloitte.com)and Jones Day (www.jonesday.com) advised Riverside on the transaction.

© 2015 PEPD • Private Equity’s Leading News Magazine • 12-4-15

Chicago Pacific Has First Close

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Healthcare focused private equity investor Chicago Pacific Founders has held a closing of $194 million of a targeted $350 million for its debut fund. The $194 million of committed capital was provided by 49 limited partners and the general partner.

Chicago Pacific was launched in 2014 and invests exclusively in healthcare services. The firm will invest up to $75 million of equity capital per opportunity in growth, minority recap and buyout transactions for cash flow positive businesses.

Chicago Pacific was founded by Managing Directors Mary Tolan, Lawrence Leisure, and Vance Vanier. Ms. Tolan is the former CEO of Accretive Health – a hospital and physicians billing process manager which she co-founded in 2003 – and former Group Chief Executive for the Resources Operating Group at Accenture (previously Andersen Consulting). Mr. Leisure is a healthcare operating executive and is the current Chairman of ADVI Reimbursement and Health Policy Advisory Services and a former senior advisor of venture capital firm Kleiner Perkins Caufield & Byers. Mr. Vanier is also a healthcare operating executive and doctor – he received his medical degree from the Johns Hopkins University School of Medicine.

A recent transaction for Chicago Pacific was the October 2015 formation of Marquee Dental Partners. The firm committed $35 million in capital to fund the new platform. Marquee Dental is led by CEO James Usdan who has served as CEO of three public companies and five private equity-backed firms.  He has more than 30 years of experience in healthcare provider and multi-site management operations, including having led or served as a board member of four dental service companies.

Joining Mr. Usdan at Marquee Dental are COO Christy Englehart – who has 25 years of dental operations experience – and Chief Dental Officer Dr. Steve Hecklin, CFO Luke Lamphron and Vice President of Business Development Les Matthews. Marquee Dental is based in Nashville (www.marqueedentalpartners.com).

Chicago Pacific has offices in Chicago and San Francisco (no website found) (LinkedIn).

© 2015 PEPD • Private Equity’s Leading News Magazine • 12-4-15