SunTx Sells Carolina Beverage to Brynwood
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SunTx Sells Carolina Beverage to Brynwood

SunTx Capital Partners has sold Carolina Beverage Group to Cold Spring Brewing Company, a portfolio company of Brynwood Partners since August 2017.

Carolina Beverage Group (CBG) is a contract manufacturer of malt beverages, distilled spirits, wine, energy drinks, sparkling water, teas, and other ready-to-drink beverages. CBG has both cold fill and hot fill capabilities and its products can be produced in a range of sizes including 8, 8.4, 12 (sleek and standard), 16, 24 and 32 ounces. The company’s manufacturing facilities in Mooresville, NC and Fort Worth, TX have the capacity to produce over 60 million cases annually.

CBG, led by CEO Andy Kerner, was founded in 1997 and is headquartered north of Charlotte in Mooresville, NC (www.carolinabeveragegroup.com).

Cold Spring is primarily a contract manufacturer of soft drinks, beer, malt beverages, and energy drinks for other companies’ proprietary brands and retailers’ private labels. Cold Spring also brews beer under its own brand, Third Street Brewhouse, for distribution locally in Minnesota and Wisconsin. Cold Spring was founded in 1874 and is headquartered 80 miles northwest of Minneapolis in Cold Spring, MN (www.coldspringbrewery.com).

The combination of CBG and Cold Spring results in a company with over 650,000 sq. ft. of manufacturing space and 1.7 million sq. ft. of warehouse availability. It will operate under the Carolina Beverage Group name with a headquarters in Mooresville, NC.

To acquire CBG, Brynwood made an additional investment in Cold Spring through its eighth fund. “While Brynwood VII already had an investment in Cold Spring, this marks Brynwood VIII’s first investment since the fund closed in January 2018 with $649 million of committed capital,” said Ian MacTaggart, President and COO of Brynwood. “We look forward to supporting Carolina Beverage’s loyal employees and growing its operations both organically and through potential strategic add-on acquisitions.”

Brynwood is an operationally-focused private equity firm that makes control investments in North American-based lower middle market companies. The firm targets non-core brands or companies operating exclusively in the consumer sector. Brynwood has $1.1 billion of capital under management and is based in Greenwich, CT (www.brynwoodpartners.com).

“We are very pleased to announce the acquisition of Carolina Beverage Group by Cold Spring,” said Henk Hartong III, Chairman and CEO of Brynwood.  “We are excited about the opportunity to create a company with a significant manufacturing footprint in the value-added beverage space that will strengthen our ability to service both national branded and retail customers with innovative products in flexible packaging solutions. Value-added manufacturing is an important sector and an area that Brynwood continues to make significant investments in.”

SunTx Capital acquired Carolina Beverage Group (then named Carolina Beer & Beverage) in August 2010. “We could not be prouder of all that has been achieved at Carolina Beverage during our ownership,” said Mark Matteson, a Partner of SunTx Capital. “Working collaboratively with the company’s management team, SunTx advised on and supported numerous investments and transformative initiatives. Carolina Beverage is now a sought-after, best-in-class contract filler for a host of international beverage brands, and is well positioned to continue its growth trajectory.”

SunTx Capital invests in middle-market manufacturing, distribution and service companies that have revenues from $40 million to $500 million and EBITDA of at least $10 million. The firm prefers companies located in the south, southeast and southwest regions of the US. Dallas-based SunTx was founded in 2001 and currently has over $600 million of assets under management (www.suntx.com).

“SunTx has been a valuable partner and resource provider during their stewardship,” said Mr. Kerner. “Their strategic vision for Carolina Beverage Group was spot on and their commitment to achieving our mutual goals never wavered. It’s amazing to see what Carolina Beverage Group has become over its 20+ year history – from a brewer of craft beers to a world-class manufacturer of global beverage brands. The company looks forward to its next stage of growth, in partnership with Cold Spring Brewing Company and Brynwood Partners.”

Cascadia Capital (www.cascadiacapital.com) was the financial advisor to Carolina Beverage and SunTx Capital.

© 2018 Private Equity Professional | May 17, 2018

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