Archives for February 23, 2017

Fireman Exits Skip Hop

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Fireman Capital Partners has sold its portfolio company Skip Hop, a designer and seller of baby and children’s products, to publicly-traded Carter’s for $140 million in cash plus additional payments based on performance. Fireman acquired a majority interest in Skip Hop in November 2013 for approximately $60 million.

Skip Hop designs and sells diaper bags, infant toys, nursery gear, bath, feeding and the ZOO line of toddler products. The company’s products are sold at over 5,000 locations in the US and Canada and in over 60 countries worldwide. Skip Hop was founded in 2003 by Ellen and Michael Diamant and is based in New York (www.skiphop.com).

“Fireman Capital’s track record in the consumer space and vision for our company was immensely helpful as we developed Skip Hop into the market leader it is today. We thank the firm for their support and look forward to further growth as part of the Carter’s team,” said Mr. Diamant.

“Skip Hop was a great investment for our firm, and we are thrilled to have been able to leverage our resources and operational expertise to help the company grow,” said Marla Sabo, Partner at Fireman Capital. “It has been a pleasure working with the entire Skip Hop organization and we are confident they have a bright future ahead under Carter’s leadership.”

Fireman Capital Partners invests from $50 million to $100 million of equity in consumer products companies with revenues between $25 million and $150 million and EBITDA from $20 million to $100 million. The firm was founded in 2008 by Chairman Paul Fireman, the former Chairman and CEO of Reebok International, and Managing Partner Dan Fireman and is based near Boston in Waltham, MA (www.firemancapital.com).

“Skip Hop is a dynamic, market leading company with unique and innovative products. We are proud to have partnered with Michael and Ellen Diamant in helping extend the company’s product portfolio, build their distribution network, expand internationally and further its online presence. We wish them continued success,” said Dan Fireman.

Harris Williams & Co. was the financial advisor to Skip Hop. The transaction was led by Managing Director Brent Spiller, and Associates Marshall Printy and Zach Ledwith of Harris Williams & Co.’s Consumer Group. “We are extremely happy to have represented Skip Hop on its sale to Carter’s,” said Mr. Spiller. “Skip Hop is one of the most exciting brands within the infant and juvenile category with a passionate consumer following.  We are delighted to have paired Skip Hop with a long-term partner in Carter’s who shares Skip Hop’s passion for the brand and vision for the future. This transaction marks another important milestone in our firm’s extensive track record advising premier brands in the infant and juvenile sector.”

Carter’s (NYSE:CRI) is one of the largest branded marketers of apparel and related products exclusively for babies and young children. Company owned brands include Carter’s and OshKosh B’gosh. Carter’s products are sold in department stores, national chains and specialty retailers domestically and internationally and also through nearly 1,000 company-operated stores in the US and Canada and online. Carter’s was founded in 1865 by William Carter and is based in Atlanta (www.carters.com).

© 2017 Private Equity Professional | February 23, 2017

New Heritage Invests in Continental Services

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New Heritage Capital has made an investment in Continental Services, a food-service provider serving corporate clients in Michigan.

Continental provides its customers with a range of services, including corporate cafés, grab-and-go markets, vending, office coffee, and special event catering. The company was founded by Jim Bardy in 1989 and is headquartered in Detroit (www.ContinentalServes.com).

Mr. Bardy will continue to control day-to-day operations of the company and will be active in directing the company’s strategic growth. “We have found true partners in New Heritage who believe in Continental’s mission and will support our exciting plans for growth,” he said. “Heritage’s experience with backing founder-owned businesses will prove invaluable as we enter our next phase of expansion with a continued focus on delivering industry-leading service to our customers.”

“We are excited to partner with an industry leader like Continental that is at the forefront of quality, technology and innovation in food management and look forward to helping management execute on their plan via organic opportunities and the active pursuit of add-on acquisitions,” said Melissa Barry, a Partner at New Heritage.

New Heritage invests minority or majority equity in companies with minimum revenues of $30 million and at least $5 million of EBITDA. Sectors of interest include aerospace, business services, consumer products, distribution, education and training, food and beverage, healthcare and healthcare services, industrial and infrastructure, manufacturing, pet products and services, specialty chemical, and test and measurement. Heritage was founded in 2006 and is headquartered in Boston (www.newheritagecapital.com).

© 2017 Private Equity Professional | February 23, 2017

Kinderhook Adds On to Primeritus

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Primeritus Financial Services, a portfolio company of Kinderhook Industries, has acquired Global Investigative Services.

Global Investigative Services (GIS) is a provider of vehicle skip tracing services, heavy equipment recovery and investigative services to financial services companies. The company was founded in 1997 by partners Greg Hill and Danny Tolbert and is headquartered near Dallas in Rockwall, TX (www.gis-investigations.com).

“GIS has established itself as a strong player in the skip tracing and heavy equipment recovery arena and we look forward to working with their team to continue to drive innovation, compliance, efficiency as well as best in class service for Primeritus’ and GIS’ clients,” said Chris McGinness, SVP of Operations for Primeritus. “Primeritus has made a concerted effort to grow in the credit union space and the acquisition of GIS will compliment this side of our business nicely.”

In February 2012, Kinderhook formed Primeritus Financial Services in partnership with three automotive finance executives – Chuck Tapp, Phil Hanks and Cam Hitchcock – and acquired the assets of ASR Nationwide, a provider of collateral recovery services to financial institutions. The purchase of GIS is the sixth add-on acquisition completed by Primeritus under Kinderhook ownership. The five earlier acquisitions were Roquemore (January 2016), Repo Remarketing (February 2014), Renovo Services (October 2012), M. Davis Company (June 2012), and the platform acquisition of ASR Nationwide (February 2012). Today, Primeritus Financial Services is a national provider of repossession management, remarketing, title services and skip tracing services to the auto finance industry. The company is based in Nashville (www.primeritus.com).

“We are delighted to join Primeritus’ team, which is the industry leader in recovery, skip tracing and remarketing services,” said Greg Hill, President of GIS.

Financing for this transaction was provided by Twin Brook Capital Partners, the middle market direct lending subsidiary of Angelo, Gordon & Co. (www.twincp.com).

Kinderhook makes control investments in companies with transaction values of $25 million to $150 million in which the firm can achieve financial, operational and growth improvements. The firm makes investments in non-core divisions of public companies, management buyouts of entrepreneurial-owned businesses, troubled situations, and existing small capitalization companies lacking institutional support. Kinderhook was founded in 2003 and is based in New York (www.kinderhook.com).

© 2017 Private Equity Professional | February 23, 2017

Wellness Pro Joins North Castle

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North Castle Partners, an investor in consumer businesses that promote healthy, active and sustainable living, has added Jay Galluzzo, co-founder and former CEO of Flywheel Sports, as a Managing Director of the firm.

“We welcome Jay to his new role as a managing director of North Castle. While working with Jay in his role as an NCP Operating Advisor, we recognized the value that he would bring as a North Castle investment professional based on his record as an entrepreneur, passion for the healthy living space and nose for new investment opportunities,” said Chip Baird, North Castle CEO and Founder.

Mr. Galluzzo has nearly 20 years of experience as an entrepreneur, executive and investor.  Since joining North Castle in 2016 as an operating advisor, he has been involved in sourcing and managing a number of investments. As a co-founder of Flywheel Sports, an operator and franchisor of stationary bike fitness clubs, he led the company from its launch in 2010 through its sale in 2014 to the Benvolio Group and Catterton Partners. During and after his time at Flywheel, he also led early stage investments in emerging brands including DreamDry and Montauk Brewing, and has served in an executive, advisory or board capacity for businesses including The Warnaco Group, Neuehouse and Qor performance apparel.

North Castle makes control investments in consumer-driven product and service companies located in North America with enterprise values ranging from $50 million to $500 million. Sectors of interest include beauty and personal care; consumer health; fitness, recreation and sports; home and leisure; and nutrition.  The firm’s current portfolio includes HydroMassage, Strengthen Lengthen and Tone, Curves International/Jenny Craig, Barry’s Bootcamp, Palladio Beauty Group, Mineral Fusion, Red Door Spas, Sprout Organics, SmartyPants, Brooklyn Boulders, Ibex Outdoor Clothing, and Turnbridge.

North Castle held a final closing for North Castle Partners VI, LP with $300 million of committed capital in August 2016. The new fund was oversubscribed and reached its close in just over six months of fundraising.

North Castle is headquartered in Greenwich, CT (www.northcastlepartners.com).

© 2017 Private Equity Professional | February 23, 2017