Gryphon Investors has entered into an agreement to sell its portfolio company, TrustHouse Services Group, a contract food service company, to Elior SCA. The transaction is expected to close early in the second quarter.
TrustHouse Services Group is a food service provider focused on the healthcare, education and corrections sectors. Divisions of TrustHouse include Aladdin Food Management (Wheeling, WV); AmeriServe Food Management (Columbia, MO); Fitz Vogt & Associates (Walpole, NH); A’viands (Minneapolis, MN); Lindley Food Services (New Haven, CT); and Valley Services (Jackson, MS). TrustHouse manages over 675 client accounts across 45 states. The company is headquartered in Charlotte, NC (www.trusthouseservices.com).
In partnership with Michael Bailey, the former CEO of Compass Group, Gryphon formed TrustHouse in March of 2008, as a result of an initiative targeting the fragmented contract food service sector in the under-penetrated healthcare, education and corrections end-markets. During Gryphon’s ownership, Mr. Bailey and management team led organic growth initiatives and integrated three acquisitions, resulting in operations expanding from 22 to 45 states and in EBITDA more than quadrupling.
“We congratulate Mike and the TrustHouse team on achieving the objective of building a truly differentiated sector leader, and on signing a definitive agreement to sell the company to Elior. Thanks to their considerable efforts, there was significant value creation for all stakeholders, including our limited partners,” said Nick Orum, Gryphon’s President.
Elior provides contract catering and related services worldwide. It offers catering and services within the education, business and industry, and healthcare and seniors sectors, as well as in leisure, culture and travel sectors. The company also provides support services, including cleaning services and facilities management services. In addition, it operates concessions in the national museums sector, railway stations, and the leisure market. Elior’s concessions business comprises food services, retail facilities, and a range of related services provided on a daily basis at motorway service areas, airports, sports stadia, railway stations, and national museums. The company was founded in 1991 and is headquartered in Paris, France (www.elior.com).
“Gryphon has been a valuable partner and I appreciate their support of the original vision, including our organic growth plans and acquisition strategy. Despite the challenging economic conditions early on, we were successful in executing our investment thesis of building a leading contract food services platform. We are enthusiastic about partnering with Elior and believe we are well positioned for our next phase of growth,” said Mr. Bailey.
Gryphon Investors makes leveraged acquisitions and growth investments in middle-market companies. The firm invests from $35 million to $100 million of capital in companies with sales ranging from $50 million to $250 million. Sectors of interest include business services, consumer and retail, automotive, chemical, general manufacturing, health care and hotels. The firm is based in San Francisco (www.gryphoninvestors.com).
“The agreement to sell TrustHouse represents the culmination of a successful five-year partnership with Mike Bailey and the TrustHouse team and further bolsters Gryphon’s strong track record in the food and facility services sectors. We have enjoyed working with TrustHouse, and thank Mike for his leadership in successfully building a national platform in the growing market for contract food service in the healthcare, education and corrections sectors. We believe TrustHouse will continue to thrive as a market leader in partnership with Elior,” said Keith Stimson, a Gryphon Partner and the head of Gryphon’s Consumer Products and Services Group.
Jefferies & Company acted as lead financial advisor and McColl Partners acted as a financial advisor to TrustHouse and Gryphon. Kirkland and Ellis and Parker Poe provided legal counsel to Gryphon and TrustHouse.
© 2013 PEPD • Private Equity’s Leading News Magazine • 3-19-13
