The recent sale of Safety Holdings (DBA SambaSafety), a provider of cloud-based data services on unsafe driving behavior, to ABRY Partners provided a home-run return to Main Street Capital.
SambaSafety’s customers include employers, insurance companies, background screeners and fleet management companies. The information is used to identify and address unsafe driving behavior and to allow insurance carriers to accurately price risk throughout the lifecycle of insurance policies. SambaSafety is led by its CEO Richard Crawford and is based in Albuquerque (www.SambaSafety.com).
In November 2011, Main Street provided both debt and equity to back the buy of the company by Cerca Group and Ticonderoga Private Equity. Main Street’s original investment in SambaSafety included a $3.0 million debt investment and a $1.0 million equity investment. After the original investment in November 2011, Main Street’s investments grew to total debt investments of $26.4 million and total equity investments of $2.1 million as Main Street provided additional funding to support SambaSafety’s growth.
On its equity investment, Main Street realized a $28.4 million gain which results in an internal rate of return of 143.2% and a 14.6x multiple on its investment. On a combined basis, the debt and equity investment resulted in an internal rate of return of 34.7% and a 2.3x multiple on the investment.
As part of the acquisition of SambaSafety by ABRY, Main Street maintained a minority equity ownership position in the company.
Main Street Capital (NYSE:MAIN) provides long-term debt and equity capital to middle market and lower middle market companies in that generally have annual revenues ranging from $10 million to $150 million. Main Street provides “one stop” financing alternatives within its lower middle market portfolio. The firm is based in Houston, TX (www.mainstcapital.com).
© 2016 Private Equity Professional • Private Equity’s Leading News Magazine • 5-12-16