Archives for December 21, 2015

Encore Invests in Cosmetics Company

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Encore Consumer Capital has made an investment in LORAC Cosmetics, a cosmetics brand founded by celebrity makeup artist Carol Shaw.

LORAC is an Hollywood-inspired brand that uses high-quality, gentle formulations across all color cosmetic categories. The name of the company is a backwards spelling of the founder’s first name. LORAC is headquartered near Los Angeles in Valencia, CA (www.loraccosmetics.com).

“My colleagues and I at LORAC are excited to be partnering with Encore Consumer Capital. I am very proud of LORAC’s success, and look forward to working with the company’s new CEO, Tim McMeekan, to bring the brand to even greater heights. The best of LORAC is yet to come,” said Ms. Shaw, who will continue on as Founder, maintaining roles in product development and public relations.

Encore Consumer Capital invests exclusively in consumer products companies that have revenues between $10 million and $100 million and where it can utilize its own consumer experience and the expertise of its operating partners at Encore Associates, a strategic advisory firm to the consumer products industry. The firm has raised nearly $600 million in equity capital and invested in 24 platform companies.  Encore was founded in 2005 and is headquartered in San Francisco (www.encoreconsumercapital.com).

“We are thrilled to have the opportunity to be involved with this special brand that Carol Shaw first introduced to the world 20 years ago that has since earned a unique place in the prestige beauty world,” said Kevin Murphy, Managing Director at Encore Consumer Capital.  “I have great confidence that Tim McMeekan and the entire LORAC team will further enhance LORAC’s trusted relationships with its retail partners and customers through the introduction of the highest quality and most innovative products.”

Intrepid Investment Bankers advised LORAC. Intrepid is a specialty investment bank that provides M&A, capital raising and strategic advisory services to middle-market companies across various industry sectors. Intrepid was formed in 2010 by a group of senior professionals from Barrington Associates, a middle-market mergers and acquisitions advisory firm that was acquired by Wells Fargo in 2006. Intrepid is headquartered in Los Angeles (www.intrepidib.com).

Brownstein Hyatt Farber Schreck acted as legal counsel to Encore and Irell & Manella acted as legal counsel to LORAC.

© 2015 PEPD • Private Equity’s Leading News Magazine • 12-21-15

Babson Backs Bakery Buy

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Babson Capital Management was the agent on a senior secured credit facility to support Gryphon Investors’ majority investment in The Original Cakerie.

The Original Cakerie is a manufacturer of frozen desserts sold into the North American retail and foodservice sectors. Products include three layer cakes; two layer cakes; single layer cakes; dessert bars; and brownies. The company was founded in 1979 by Doug McFetridge and Kent Norris and is headquartered in Delta, BC with an additional manufacturing facility in London, ON (www.cakerie.com).

Babson was the sole lead arranger and administrative agent on the transaction which included a revolving credit facility and a term loan facility. Babson led a syndication of the senior credit facility which was nearly two times oversubscribed.

“The Babson team again earned its reputation for being a reliable financing partner with the capacity to provide surety to close even on a strict timetable,” said Matt Farron, a principal at Gryphon Investors. “Gryphon appreciates Babson’s partnership on the investment in The Original Cakerie and we look forward to working with Babson again soon.”

Babson Capital has $223 billion in assets under management and is a member of the MassMutual Financial Group. The firm has offices in Boston and Springfield, MA; New York, Chicago, Charlotte and Los Angeles, and nine other offices in Europe, Asia and Australia (www.BabsonCapital.com).

“Babson is excited about the opportunity to partner with Gryphon on this Canadian platform,” said Brian Baldwin, Managing Director in Babson’s North American Private Finance Group. “We believe Gryphon’s food industry expertise will prove valuable in helping The Original Cakerie grow its business organically and through acquisition, and we look forward to supporting the company in this growth strategy.”

Gryphon Investors makes leveraged acquisitions and growth investments in middle-market companies. The firm invests from $35 million to $150 million of capital in companies with sales ranging from $50 million to $500 million. Sectors of interest include business services, consumer and retail, automotive, chemical, general manufacturing, health care and hotels. Gryphon is based in San Francisco (www.gryphoninvestors.com).

© 2015 PEPD • Private Equity’s Leading News Magazine • 12-21-15

Encore Consumer Capital Sells FreshKO

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Encore Consumer Capital has completed the sale of its portfolio company, FreshKO Produce Services – a distributor of fresh produce – to C&S Wholesale Grocers.

FreshKO is a distributor of fresh produce and produce-related items to independent retailers and small grocery chains in Central and Northern California.  The company was founded by its CEO Randal Shepherd and is headquartered in Fresno, CA (www.FreshkoProduce.com).

“Encore has been a great partner over the past three years. They’ve helped us expand our team, our footprint and capabilities,” said Mr. Shepherd.

“It has been a great pleasure for us at Encore to have partnered with Randal Shepherd, Manny Robles and the rest of the team at FreshKO since our investment in 2012. Their ability to expand FreshKO’s customer base and attract a strong partner like C&S exceeded our expectations,” said Scott Sellers, Managing Director of Encore Consumer Capital.

C&S Wholesale Grocers is one of the largest wholesale grocery supply company in the US. Founded in 1918 as a supplier to independent grocery stores, C&S now services customers of all sizes, supplying approximately 6,500 independent supermarkets, chain stores, military bases, and institutions with over 170,000 different products. The company is headquartered in Keene, NH (www.cswg.com).

Encore Consumer Capital invests exclusively in consumer products companies that have revenues between $10 million and $100 million and where it can utilize its own consumer experience and the expertise of its operating partners at Encore Associates, a strategic advisory firm to the consumer products industry. The firm has raised nearly $600 million in equity capital and invested in 24 platform companies.  Encore was founded in 2005 and is headquartered in San Francisco (www.encoreconsumercapital.com).

© 2015 PEPD • Private Equity’s Leading News Magazine • 12-21-15

GenNx360 Acquires AerWay

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Salford Group, a portfolio company of GenNx360 Partners, has acquired the AerWay advanced aeration products line (AerWay) from SAF-Holland Canada.

Salford is a manufacturer of primary tillage, secondary tillage, seeding and fertilizer application equipment. The company has manufacturing facilities in the US, Canada, and Russia.  Salford was founded in 1978 by Jake Rozendaal and is headquartered southwest of Toronto in Salford, ON (www.salfordgroup.com).

GenNx360 Partners acquired Salford in 2013 and the buy of AerWay is Salford’s third acquisition in the past 14 months. In 2014, Salford acquired BBI Spreaders and in 2015 acquired Valmar Airflo. According to GenNx360, the AerWay acquisition expands Salford’s niche tillage product lineup to offer more vertical tillage and pastureland management tools that appeal to livestock and mixed farming customers.

“This transaction is our third add-on acquisition, further enhancing GenNx360’s commitment to and investment in the Salford platform,” said Matt Guenther, the GenNx360 Partner who led the transaction.

With close proximity to Salford’s Ontario headquarters, AerWay will continue to produce equipment in its Norwich, Ontario facility.  “We are very pleased to bring AerWay products under the Salford tillage umbrella,” said Geof Gray, CEO of Salford Group. “Both companies focus on innovative designs to meet customer needs, create tools with multi-use capabilities and emphasize soil productivity and management, with vertical tillage/minimal disturbance tools and topdressing or cover cropping being an important part of that.”

GenNx360 is a private equity firm focused on investing in industrial business-to-business companies in the middle market. Sectors of interest include aerospace & defense; automotive; building products; food & agriculture; healthcare; metals & mining; oil & gas and power; packaging, specialty chemicals; and transportation. GenNx360 was founded in 2006 and is headquartered in New York (www.gennx360.com).

© 2015 PEPD • Private Equity’s Leading News Magazine • 12-21-15