Sentinel Buys Holley from Lincolnshire

Driven Performance Brands, a portfolio company of Sentinel Capital Partners, has acquired Holley Performance Products, a maker of branded performance products for automotive enthusiasts, from Lincolnshire Management.

Holley Performance Products is a marketer and supplier of high-performance carburetors, manifolds, superchargers, water pumps, fuel injectors and fuel pumps for street and race applications. The company’s products are used in the late-model, classic, truck and jeep, and racing vehicle sub-segments.

Company-owned brand names include Holley, Sniper EFI, MSD, Accel, Diablosport, Superchips, Edge, and Hooker Blackheart. Holley, founded in 1903, is headquartered in Bowling Green, KY and employs approximately 350 people (www.holley.com).

“Holley provides a large and vibrant community of passionate consumers with high-performance products that are essential to their lifestyle,” said Tom Tomlinson, President and CEO of Holley. Uniting Holley and Driven expands our product offering and market-leading portfolio, deepens our connection to our enthusiast base, and, importantly, brings together two highly talented management teams.”

Driven Performance Brands (DPB) is a designer, manufacturer, and marketer of specialty automotive aftermarket performance products for car and truck enthusiasts. DPB’s product line includes exhausts, transmissions, drivetrains, and electronic tuning products. Company-owned brand names include Flowmaster, B&M Racing and Performance, Hurst Shifters, Hurst Driveline Conversions, and Dinan Engineering.

DPB sells its products through online specialty retailers, warehouse distributors, auto dealers, traditional auto parts retailers, and OEMs, as well as directly to consumers. The company was founded in 1953 and is headquartered in Santa Rosa, CA (www.flowmastermufflers.com). Sentinel acquired DPB in September 2015 from Dubin Clark which had owned the company since July 2005.

“As one business, Holley and Driven will be a powerhouse at the center of a fragmented industry with highly favorable market dynamics,” said Driven CEO Brian Appelgate. “We share with Holley many similarities in how we interact with and earn the loyalty of our passionate customers. In addition, our brand portfolios are highly complementary and the combined business will be highly adept at identifying, acquiring, and investing in new brands.”

“Holley is a strong, consumer-focused company with a portfolio of powerful brands and a meaningful edge in engineering and technology,” said Jim Coady, a Partner at Sentinel. “Holley operates in the large, highly fragmented, and steadily growing automotive enthusiast market. Led by a deeply-involved and experienced management team, Holley has a proven ability to integrate add-on businesses successfully and leads the industry when it comes to product innovation. We believe that Holley and Driven are extremely complementary in terms of culture, brands, and capabilities. Combining Holley and Driven creates the largest and most diversified business in the industry.”

Sentinel Capital Partners invests in management buyouts, recapitalizations, corporate divestitures, and going-private transactions of businesses with EBITDAs up to $65 million. Sentinel targets eight industry sectors: aerospace & defense, business services, consumer, distribution, food & restaurants, franchising, healthcare, and industrials. The firm is headquartered in New York (www.sentinelpartners.com).

Lincolnshire acquired Holley in October 2013 from Monomoy Capital Partners. “Holley’s brand strength, leading product portfolio and best-in-class management team represented a very compelling investment opportunity for us,” said T.J. Maloney, Chairman and CEO of Lincolnshire Management. “Since partnering with the company in 2013, we have worked closely with Tom Tomlinson and his team to execute an aggressive acquisition strategy and drive significant organic growth through increased investment in new product development.”

“Lincolnshire has demonstrated excellent knowledge of our market, products and consumers since day one. Their ability to peel back the layers of our business, understand the complexity of the issues we face and add tangible value throughout the organization has meaningfully enhanced our growth trajectory and evolution over the past 5 years,” said Mr. Tomlinson.

“Holley is an iconic brand with a proven ability to drive innovation through focused product development and cultivate authentic connections with enthusiast consumers across the industry. Tom and the Holley team have done a tremendous job navigating changes in technology and consumer preference and, as a result, have been able to triple revenues and quadruple earnings during our investment period,” said Ben Bartlett, a Principal at Lincolnshire.

Lincolnshire is a middle market private equity firm that manages $1.7 billion of capital and focuses on acquiring companies with $50 million to $500 million in revenue. Lincolnshire has completed more than 85 acquisitions and is currently investing out of its $835 million private equity fund, Lincolnshire Equity Fund IV.  Founded in 1986, the firm is headquartered in New York with an additional office in Chicago (www.lincolnshiremgmt.com).

Holley was advised on this transaction by Lazard Middle Market and UBS Investment Bank.

© 2018 Private Equity Professional | October 29, 2018

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