Archives for July 1, 2016

Bunker Hill Continues Tattoo Build Up

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Nexus Brands Group, a portfolio company of Bunker Hill Capital, has acquired Kingpin Tattoo Supply. Kingpin Tattoo will operate alongside TATSoul – a supplier of furniture, equipment and consumable supplies to the tattoo industry – which Bunker Hill acquired in November 2015. According to Bunker Hill, this combination creates the largest manufacturer and distributor of tattoo supplies in North America.

Kingpin Tattoo Supply is a designer, manufacturer and distributor of needles, tubes, inks, machines, medical supplies and body piercing accessories. The company was founded in 1996 and is based in St. Petersburg, FL (www.kingpintattoosupply.com).

Nexus Brands Group is a platform company formed by Bunker Hill to hold and operate businesses that it acquired through the purchase of ImportLA in November 2015. The company’s brands and businesses design, manufacture, market and distribute furniture, equipment and supplies to professional customers serving the tattoo, pet grooming and spa/salon markets. Brand names include TATSoul (tattoo furniture and supplies), ComfortGroom (pet grooming tables and accessories), and ComfortSoul (massage, facial and pedicure furniture and accessories). The company is headquartered near Los Angeles in Baldwin Park, CA (www.tatsoul.com) (www.comfortgroom.com) (www.comfortsoul.com).

With closing of the acquisition of Kingpin, Bunker Hill has named Brian Etter as chief executive officer of Nexus Brands. Mr. Etter was most recently the chief executive officer of Motorsport Aftermarket Group (MAG), a portfolio company of Leonard Green & Partners and a designer, manufacturer and marketer of branded aftermarket parts and accessories for motorcycles. MAG was sold in 2014 to LDI, an Indianapolis-based family office that invests capital for the Lacy family – the founders of the US Corrugated Fiber Box Company.

“Brian’s terrific job guiding MAG through a fourfold increase in revenue, the acquisition and integration of six companies and the management of eighteen brands worldwide within an enthusiast market gives us great confidence that Brian is the ideal person to lead Nexus Brands Group,” said Rufus Clark, Managing Partner, Bunker Hill Capital.

Bunker Hill makes control investments in lower middle market companies with EBITDAs between $5 million and $20 million, and enterprise values up to $120 million.  Sectors of interest include industrial products, business services, consumer products, and specialty retail.  The firm has offices in Boston and San Diego (www.bunkerhillcapital.com).

© 2016 Private Equity Professional • 7-1-16

Freeman Spogli Invests in City Barbeque

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City Barbeque, a fast-casual restaurant company, has been acquired by Freeman Spogli & Co. City Barbeque operates 26 company-owned restaurants in Ohio, Indiana, Kentucky and North Carolina and also has two legacy franchise locations in Ohio.

City Barbeque’ products are slow-smoked on site, and side dishes and desserts are made from scratch on site as well. In addition to its restaurants, City Barbeque offers catering for weddings, company picnics, large parties, and other events. The company was founded by Rick Malir in 1999 and is headquartered in Columbus (www.citybbq.com).

“This is an exciting moment in our company’s history,” said Mr. Malir. “This partnership allows us to take City Barbeque to new places, give our amazing employees additional opportunities to grow, and bring smiles to new guests and raving fans across the country.” Mr. Malir and a team of barbeque enthusiasts won the American Royal Invitational for the best beef brisket in the country. The American Royal Association – based in Kansas City – is an agricultural trade association founded in 1899. The association annually holds the World Series of Barbecue – the world’s largest barbecue competition.

“City Barbeque possesses the exact qualities Freeman Spogli looks for in a restaurant partner,” said Brad Brutocao, a Partner at Freeman Spogli. “The company has craveable food, a passionate management team, an impressive culture of hospitality, and a loyal fan base in each of its markets. We have been interested in City Barbeque for several years, and we are enthusiastic about partnering with Rick and his team during this exciting phase of growth for the company.”

Freeman Spogli invests in middle market consumer and distribution companies. Since its founding in 1983, the firm has invested over $3.7 billion in 55 portfolio companies with an aggregate transaction value of approximately $21 billion.  Freeman Spogli has offices in Los Angeles and New York (www.freemanspogli.com).

© 2016 Private Equity Professional • 7-1-16

Fort Point Invests in WolfePak

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Fort Point Capital has acquired WolfePak Software, a provider of financial, accounting and regulatory compliance software to the oil and gas industry.

WolfePak Software was founded in 1986 by Charlie Wolfe, a certified public accountant, to provide user-friendly accounting software for companies active in the oil and gas industry. Mr. Wolfe will continue as CEO of the company and remains a significant shareholder.

WolfePak products are used by oil and gas well operators, first purchasers, investors, and service companies. The company has completed more than 2,500 installs with active users in 41 states and nine countries. In addition to its core software and add-on modules, WolfePak provides technical support, systems conversions, training and hosting services. WolfePak is headquartered in Abilene, TX (www.wolfepak.com).

“I’m excited to partner with Fort Point Capital to take our company to the next level,” said Mr. Wolfe. “With their experience, insight and resources, WolfePak will continue to find ways to improve our software offering and better serve customers.”

“While evaluating WolfePak we were impressed by how well Charlie and his team performed during the current energy environment, further demonstrating that customers consider WolfePak to be critical to their operations, while also saving them valuable time and money,” said Christina Pai, a partner at Fort Point. “We have confidence that the company will continue to excel as additional operators, first purchasers, investors and service providers learn about WolfePak’s merits.”

Fort Point invests from $5 million to $25 million in service-oriented, lower middle-market companies across a range of sectors, including business services, healthcare, consumer, and software & information. Fort Point is currently investing from FPC Small Cap Fund I which closed in 2012 with $93 million in capital. The firm was founded in 2010 and is based in Boston (www.fortpointcapital.com).

Bell Capital Finance – a unit of Bell State Bank & Trust – and GMB Mezzanine Capital provided debt financing for the transaction. RSM (www.rsmus.com) was the financial advisor to Fort Point and Kirkland & Ellis (www.kirkland.com) provided legal counsel.

© 2016 Private Equity Professional • 7-1-16

Puzzle-solver Origami Capital Closes Fund III

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Origami Capital Partners has closed its third fund at $371 million. Origami specializes in buying assets trapped in complex legal structures or difficult ownership situations. Limited partners in the fund include the usual mix of endowments, foundations, public pensions, corporate pensions and family offices.

Origami’s investments – typically between $10 million and $50 million – involve real estate, private equity, debt, bankruptcy, and litigation claims. Investment examples include illiquid residual interests in hedge funds; real estate and private equity fund interests and restructurings; hard-to-sell assets owned by funds; private joint ventures; minority interests in operating general partnerships; non-performing loans; and other illiquid investments with no apparent exit strategy.

Origami will pursue investments anywhere on the globe but has a specific interest in transactions based in North America and Europe. Origami was founded in 2008 and is led by its managing partners Thomas Elden and Jeffrey Young (www.origamicapital.com).

Sixpoint Partners served as Origami’s placement agent for the fundraise.  Sixpoint  is headquartered in New York with additional offices in Chicago, San Francisco, Abu Dhabi, and Singapore (www.sixpointpartners.com).

“The Origami team is excited about the opportunities we are seeing in the market and are pleased to be able to capitalize on them with Fund III. We are grateful for the support and confidence of our investors, as well as Sixpoint Partners’ success in communicating our strategy to the investment community,” said Mr. Elden.

“Origami’s experienced team and impressive track record generated strong demand from investors looking for undervalued assets across sectors,” said Eric Zoller, Founder & Partner of Sixpoint Partners. “The fund strategy is consistent with our stated focus of delivering unique strategies to our lim ited partners across the private equity spectrum.”

Sidley Austin (www.sidley.com) provided legal counsel to Origami.

© 2016 Private Equity Professional • 7-1-16

TorQuest Closes Latest Fund at Hardcap

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TorQuest Partners has held an above target final closing of TorQuest Partners Fund IV at the fund’s hard cap of $925 million. The initial targeted amount was $750 million.

TorQuest makes equity investments of $15 million to $100 million in companies with enterprise values of $40 million to $250 million that are located in Canada and the US.  The firm invests in a range of industries but prefers the manufacturing, business services, financial services, food, consumer products and specialty chemicals sectors.

“We very much appreciate the ongoing trust and confidence of our limited partners,” said Brent Belzberg, Senior Managing Partner. “We will continue to execute the same strategy with the same team that has delivered attractive investment returns for our partners, and established a strong reputation among business owners and management teams, and across the Canadian business and financial communities.”

TorQuest was founded in 2002 and has over $2 billion of equity capital under management. The firm is headquartered in Toronto (www.torquest.com).

© 2016 Private Equity Professional • 7-1-16

Grey Mountain Staffs Up

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Colin McCarthy has joined Grey Mountain Partners as a Senior Associate.  Prior to joining Grey Mountain, Mr. McCarthy was an Associate at Maranon Capital.

At Maranon, Mr. McCarthy was active in completing senior debt, subordinated debt, and minority equity transactions for middle-market companies. Previously, he was an investment banking analyst at William Blair. Mr. McCarthy has an MBA in Finance from Columbia and a BA in History from Yale.

Grey Mountain has approximately $700 million of assets under management and was founded in 2003 by managing partners Rob Wright and Jeff Kuo. The firm invests up to $75 million in control acquisitions of companies with enterprise values between $30 million and $150 million. Sectors of interest include aerospace and defense; building products and materials; business process outsourcing; diversified manufacturing; energy and power; financial services; food and beverage; healthcare services and technology; industrial services; packaging; professional services; specialty chemicals; technology; transportation and logistics; and wholesale distribution.

Grey Mountain is based in Boulder with additional offices in Minneapolis and Pittsburgh (www.greymountain.com).