February 11, 2016
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Archives for February 11, 2016

Spell Invests in Atlas Wire

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atlas nf4Spell Capital Partners has made an investment in Atlas Wire, a manufacturer of insulated wire. This is the first investment made by the firm’s latest fund, Spell Capital Partners Fund V, LP.

atlas wire nf55Atlas Wire is a manufacturer of polyvinyl chloride (PVC), nylon, and cross-linked polyethylene insulated wire used in a variety of applications including in the automotive, machine tools, industrial machinery, building and fixtures, and military sectors. The company was founded in 1950 and operates out of two facilities; its headquarters and primary operating facility located near Chicago in Schiller Park, and a second manufacturing facility located in Tucson (www.atlaswirecorp.com).

Bill spell nf1“Spell Capital is excited to be partnering with Bruce Leska, CEO of Atlas Wire, and the outstanding employees of Atlas Wire,” said Bill Spell, president and founder of Spell Capital. “Atlas is a niche manufacturer with an excellent reputation, outstanding customer service and top quality products.  We look forward to working with the Atlas management team, its employees and helping to expand upon their success.”

Spell Capital Partners makes control investments of $3 million to $15 million in industrial manufacturing companies with revenues of at least $5 million and EBITDAs of at least $1.5 million.  The firm is based in Minneapolis (www.spellcapital.com).

Spell’s latest fund, Spell Capital Partners Fund V, LP, with a target of $50 million, has closed on $36 million as of December 2015.

© 2016 Private Equity Professional • 2-11-16

KarpReilly Acquires Zola

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zola nf1Zola Fruits of the World, a maker of good-for-you beverages and foods, has been acquired by private equity firm KarpReilly.

Zola was founded in 2002 and its products today include Coconut Water, Coconut Water with Espresso and Coconut Water with Pulp. Zola also makes organic acai juices including Acai Original, Acai with Blueberry, Acai with Pomegranate, and Acai with Mango and Chia. The company launched a new product – Dark Chocolate Covered Fruit (acai, blueberry, coconut, and banana) – in October 2015. Zola’s products are sold through grocery and natural food stores in the US and Canada. The company is headquartered in San Francisco (www.livezola.com).

zola nf12Chris Cuvelier nf1Zola is led by Chris Cuvelier, founder and CEO, and the current management team will remain in place post-sale. “KarpReilly is the perfect partner for Zola,” said Mr. Cuvelier. “Their long term approach and track record for growing great brands will help Zola reach its full potential.”

KarpReilly plans to grow the business by providing capital to support rapid scaling of the brand including new product development. “We like to invest in great brands and passionate people,” said Allan Karp, co-Founder of KarpReilly. “Chris and the Zola team have done a fantastic job creating an amazing brand and a loyal following leveraging their great tasting products and the unique Fruits of the World brand platform. The team has some great ideas in the pipeline and we look forward to supporting them as they take the company to the next level.”

Zola recently announced new distribution agreements and continues to expand its footprint in natural food and conventional grocery stores across the country. “Our expanding distribution and soon to be announced new products, coupled with this new partnership, will give us the opportunity to reach more consumers with our great tasting better-for-you products,” said Mr. Cuvelier.

karp reilly nf1KarpReilly invests in consumer growth companies at the lower end of the middle market through a variety of transaction types including growth equity, management buyouts, acquisition financings and recapitalizations. The firm’s investment size is from $10 million to $75 million of equity capital. Industries of interest include consumer brands; building products; business services; health care services; retail; and restaurants (www.karpreilly.com).

© 2016 Private Equity Professional • 2-11-16

J.W. Childs Acquires RevZilla

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revzilla nf1J.W. Childs Associates has acquired RevZilla Motorsports. As part of the transaction, J.W. Childs has formed a new holding company to own RevZilla and the holding company will also own the equity of Cycle Gear, a provider of motorcycle apparel, parts and accessories, which was acquired by J.W. Childs in January 2015 from Harvest Partners.

revzilla nf12RevZilla is an e-commerce retailer of motorcycle apparel, parts and accessories. Products include jackets, helmets, gloves, pants, boots, exhaust systems, and tires. The company was founded in 2007 by Anthony Bucci, Nick Auger and Matt Kull and is headquartered in Philadelphia (www.revzilla.com).

Cycle Gear is a national retailer of helmets, jackets, pants, boots, gloves and other motorcycling related products.  The company operates 113 stores in 34 states, has a significant online business, and distributes more than 13 million catalogs annually.  Cycle Gear was founded in 1974 and is headquartered north of San Francisco in Benicia, CA (www.cyclegear.com).

RevZilla and Cycle Gear will continue to operate as independent sister companies with headquarters in Philadelphia and Benicia. Each of the three RevZilla founders will maintain their positions at RevZilla. Messrs. Bucci and Kull will join the board of directors of the holding company along with Joseph Fortunato, executive chairman of Cycle Gear. Mr. Fortunato joined the Cycle Gear board in January 2015 when J.W. Childs acquired the company from Harvest Partners. He is a long-time specialty retail executive and was CEO of GNC from 2005 to 2014.

J.W. Childs invests in middle market companies based in North America. Sectors of interest include consumer products, specialty retail and healthcare. The firm was founded in 1995 and is based west of Boston in Waltham, MA (www.jwchilds.com).

J.W. Childs expects to make more investments in the motorcycle enthusiast sector to build the brand awareness and national retail presence of Cycle Gear and RevZilla.

© 2016 Private Equity Professional • 2-11-16

Bedford Capital Sells L.B. Maple Treat

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lb maple nf1Canadian middle-market private equity firm Bedford Capital has sold its portfolio company, L.B. Maple Treat, to Champlain Financial.

lb maple nf11According to Bedford Capital, L.B. Maple Treat (LBMT) is one of the largest bottlers of branded and private label maple syrup in the world. It also sells maple syrup-related products including cookies, maple sugar and maple butter. The company is led by its president Luc Bergeron and is headquartered in Quebec (www.lbmapletreat.com).

Private equity firm Champlain Financial, the buyer of LBMT, invests in companies with EBITDAs ranging from $3 million to $10 million. Sectors of interest include consumer, retail distribution, healthcare and niche manufacturing. The firm is led by its managing partner Pierre Simard and is headquartered in Quebec (www.champlaincanada.com).

bedford nf13Bedford Capital invests from $5 million to $15 million of equity in companies that have EBITDAs from $2 million to $15 million.  The firm prefers to be the majority investor but will invest in companies where they have a minority interest so long as there is an alignment of interest with management and other shareholders. In order to remain in close contact with the management teams of its portfolio companies, Bedford prefers companies with head offices located within three hours travel time from Toronto. The firm was founded in 1982 and is headquartered in Toronto (www.bedfordcapital.ca).

Toronto-based CCC Investment Banking (www.cccinvestmentbanking.com) was the financial advisor to LBMT. Bill Farrell, Managing Director, and Razmig Boghossian, Vice President, led the transaction for CCC.

© 2016 Private Equity Professional • 2-11-16

Leonard Green Adds-on to Mister Car Wash

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bills nf1Leonard Green continues to build its car wash platform with the recent buy of four Florida-based Bill’s Car Washes. The acquired stores are all located in the Orlando metropolitan area in the cities of Casselberry, East Orlando, Sanford and Chickasaw.

Leonard Green acquired Mister Car Wash in August 2014 from Onex Corporation. At the time of the acquisition, Mister Car Wash operated 134 car washes and 32 lube centers in 14 states across the country, making it the largest car wash and lube center chain in the United States. Today, including the Bill’s acquisitions, Mister Car Wash now operates 164 car washes and 34 express lubes in 19 states.

mister nf1According to Leonard Green, Mister Car Wash is the most acquisitive company in the car wash industry having completed over 25 acquisitions – representing over 70 stores – since 2009.  The company has about 4,800 employees and services more than 15 million vehicles annually.  Mister Car Wash was founded in 1996 and is headquartered in Tucson (www.mistercarwash.com).

Casey Lindsay nf1Casey Lindsay is the Director of Acquisitions for Mister Car Wash. “Since opening Bill’s Car Wash in 1992, Bill Walker has built a great platform, well known for delivering a quality car wash with a friendly customer experience,” said Mr. Lindsay.

The Bill’s stores (www.billscarwash.com) acquisitions follow Mister Car Wash’s acquisition in October 2015 of three Top Dog Express car washes located in the Florida cities of Lake Mary, Melbourne and Sanford.

Leonard Green & Partners invests in middle-market companies in the retail, distribution, healthcare, aerospace/defense, and consumer/business services sectors. The firm was founded in 1989 and manages approximately $15 billion of equity capital. Leonard Green & Partners is headquartered in Los Angeles (www.leonardgreen.com).

© 2016 Private Equity Professional • 2-11-16

Varsity Sells Forefront Dermatology to OMERS

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forefont nf1Varsity Healthcare Partners has sold its majority interest in Forefront Dermatology to OMERS Private Equity. This sale represents the first realized exit for Varsity Healthcare Partners which was founded in October 2012 by David Alpern and Kenton Rosenberry.

Varsity Healthcare Partners (VHP) acquired a majority stake in Forefront, a provider of practice management services to dermatology clinics, in May 2014. Since acquiring Forefront, VHP has grown the business from 37 clinics with 42 board-certified dermatologists operating in three states, to 82 clinics with 90 board-certified dermatologists operating in 11 states.

Kenton Rosenberry nf1“In partnership with Forefront’s management team, we aggressively and successfully grew the company while maintaining the core tenets of delivering exceptional patient care and establishing a terrific work environment for physicians,” said Kenton Rosenberry, a partner with VHP.

The sale to OMERS follows VHP’s and Forefront’s completion of the add-on acquisition of Premier Dermatology in November 2015. This acquisition provided an entry point into Illinois for Forefront Dermatology, filling a gap in the company’s Midwest footprint. Like Forefont, Premier Dermatology provides medical and surgical dermatology, cosmetic surgery, and a range of other aesthetic services and products. The company – based near Chicago in Crest Hill, IL – was considered to be one of the larger providers of dermatology services in Illinois.

According to VHP, Forefront Dermatology is one of the five largest dermatology practices in the United States and provides general, surgical and cosmetic dermatology services as well as laboratory services. The company’s network consists of 82 clinics across 11 states, including Wisconsin, Michigan, Indiana, Illinois, Iowa, Kentucky, Minnesota, Missouri, Ohio, Pennsylvania and Virginia. Forefront Dermatology is headquartered north of Milwaukee in Manitowoc, WI (www.forefrontdermatology.com).

varsity nf1Varsity Healthcare Partners is an investor in founder and/or entrepreneur owned companies that are active in the healthcare services sector and have from $5 million to $15 million of EBITDA. The firm has offices in Los Angeles and Stamford (www.varsityhealthcarepartners.com).

“We have enjoyed working closely with the VHP team over the past 18 months and building an industry-leading company in the dermatology sector,” said Dr. Kenneth Katz, founder and president of Forefront. “VHP’s domain expertise and commitment to the Forefront values has enabled us to surpass our growth objectives without sacrificing our culture and commitment to excellence.”

omers nf1OMERS Private Equity, the buyer of Forefront Dermatology, manages the private equity activities of OMERS, one of Canada’s largest pension funds. The group’s investment strategy includes the active ownership of businesses in North America and Europe. Sectors of interest include manufacturing, financial and business services, industrial and consumer products, transportation, and technology. Investment sizes range from $100 million to $500 million. The firm is located in Toronto with offices in New York and London and has $6 billion of investments under management (www.omerspe.com).

New York-based investment bank Jefferies (www.jeffries.com) was the financial advisor to Forefront Dermatology and VHP, and Morgan, Lewis & Bockius (www.morganlewis.com) provided legal counsel.

© 2016 Private Equity Professional • 2-11-16

L Catterton Closes Fund 3

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l catterrton nf1L Catterton has closed its third North American growth fund, L Catterton Growth Partners III, LP (LCGP III), with $615 million of commitments. The fund was oversubscribed and received support primarily from existing investors but also added a number of new international investors.

The closing of LCGP III follows the formation of Catterton’s January 2016 partnership with LVMH and Groupe Arnault to create L Catterton. This new investment partnership combines Catterton’s North American and Latin American private equity operations with LVMH and Groupe Arnault’s existing European and Asian private equity and real estate operations, currently conducted under the L Capital and L Real Estate franchises. L Catterton is 60% owned by the partners of L Catterton and 40% jointly owned by LVMH and Groupe Arnault.

LVMH, more formerly known as LVMH Moët Hennessy Louis Vuitton SE, is a European multinational luxury goods conglomerate, headquartered in Paris. The company was formed in 1987 through the merger of fashion house Louis Vuitton and champagne and cognac producer Moët Hennessy. LVMH has 60 subsidiaries that each manage a small number of prestigious brands. Christian Dior, the luxury goods group, is the main holding company of LVMH, owning 41% of its shares, and 59% of its voting rights. Bernard Arnault, majority shareholder of Dior, is Chairman of both companies and is also the CEO of LVMH.

Michael farello nf1“We are delighted to close our third and largest North American growth fund, and thank our dedicated and loyal limited partners for their commitment to L Catterton,” said Michael Farello, Managing Partner of L Catterton Growth.  “L Catterton is the clear leader in global consumer investing and our focus remains on partnering with entrepreneurs and great executives to develop high-growth companies.”

LCGP III, like Catterton’s earlier funds, will invest between $10 million and $50 million of capital in consumer-focused companies growing at double or triple digit rates. Areas of specific interest include food and beverage, retail and restaurants, consumer products and services, consumer health, and media and marketing services.  L Catterton has 120 investment and operating professionals in 18 offices. The firm was founded in 1989 and is headquartered in Greenwich, CT (www.cpequity.com).

Jonathan Owsley nf4“This is an exciting time to be investing in consumer growth as old consumer categories are being re-imagined and new consumer categories are being created,” said Jonathan Owsley, Managing Partner of L Catterton Growth.

Prior to combining with L Capital to form L Catterton, Catterton’s previous two North America-focused growth funds were Catterton Growth Partners II which closed in September 2013 with $420 million of capital and Catterton Growth Partners which closed in April 2008 with $316 million in capital.

© 2016 Private Equity Professional • 2-11-16

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