Bestar, a portfolio company of Novacap since July 2017, has acquired Bush Industries for $160 million from Lorraine Capital and Landon Capital Partners.
Bush Industries designs, produces and distributes home and commercial office, entertainment, bedroom, storage, seating, occasional and entryway furniture.
The company was founded in 1959 and its headquarters and US manufacturing operations are in Jamestown, New York, with additional facilities in Pennsylvania, California and China. Bush has approximately 300 employees in Jamestown and more than 400 in total.
Bestar is a designer, manufacturer, distributor and online seller of commercial office, home office, storage, bedroom, tables and garage storage furniture. The company has manufacturing facilities in Lac-Mégantic and Sherbrooke, Quebec and its products are distributed primarily in Canada and the United States. The company, with approximately 200 employees, was founded in 1948 by Jean-Marie Tardif and is headquartered 150 miles east of Montreal in Lac-Mégantic, Quebec.
“Bestar’s goal is to concentrate their efforts on e-commerce solutions for home and office furniture,” said Frederick Perrault, a senior partner at Novacap. “Bestar’s and Bush’s leadership teams see a significant and fast-growing market opportunity for furniture sold online and shipped directly to the end consumer. This emerging business model provides furniture consumers a convenient, rapid and affordable shopping solution.”
The combined companies will operate under the Bestar name and have annual revenues of about $200 million (C$260 million) with over 600 employees including more than 200 in Canada. Michael Evans, president and CEO of Bush Industries, will serve in the same role for the combined companies.
“While we will see some savings from efficiencies once the companies are integrated, our main objective for the combination will be to further expand our product assortment, leverage our nationwide quick shipping capabilities, and our global manufacturing and sourcing footprint to further accelerate the rapid growth we are both experiencing,” said Mr. Evans.
Novacap, with $3.6 billion in assets under management, invests in middle-market companies within traditional industries and in companies in the technology, media and telecommunications sector. The firm was founded in 1981 and has offices in Toronto, and near Montreal in Brossard, Quebec.
Bush Industries was acquired by Lorraine Capital and Landon Capital Partners in June 2018 with Ironwood Capital providing subordinated debt.
“The Bush Industries sale opportunity was ideal for management and our ownership team. The opportunities available to the combined company will be enormous and this is an excellent result for the employees of Bush and for Western New York,” said William Maggio, managing partner of Lorraine. “We are excited that Mike Evans, CEO of Bush, will become the CEO of the combined entities, as he along with countless others have been responsible for tremendous growth at Bush. It really is the ‘win-win’ type of outcome we all hoped for when we acquired it with our partners.”
Lorraine Capital makes control investments in lower middle-market companies located in the Northeastern US that have from $25 million to $150 million of revenue and EBITDA of $3 million or more. The firm is based in Buffalo, New York.
Landon Capital Partners is the direct private equity investment group of the Landon family and invests in lower middle-market companies that have from $5 million to $20 million of EBITDA. Sectors of interest include healthcare services, business services, niche manufacturing, food, and beverage. The firm was founded in 2015 and has offices in Boston and London.
© 2020 Private Equity Professional | January 17, 2020