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Bunker Hill Sells California Family Fitness to Perpetual

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Bunker Hill Capital has sold its portfolio company California Family Fitness – an owner and operator of fitness centers in the greater Sacramento metropolitan area – to Perpetual Capital Partners.

California Family Fitness (CFF) currently has 19 mid-to-large format club locations, each of which offers a selection of exercise equipment, swimming pools, basketball and racquetball courts. Other services include fitness class instruction, child care, tanning, sauna and steam rooms, and organized sports leagues. The company is headquartered northeast of Sacramento in Orangevale, CA (www.californiafamilyfitness.com).

“Bunker Hill Capital helped us grow from an entrepreneurially run company to a more developed, professionally run organization,” said Randy Karr, President of California Family Fitness. “The team from Bunker Hill helped us think more strategically about our business and helped put in place the necessary tools and controls to execute our strategy.”

Bunker Hill makes control investments in lower middle market companies with EBITDAs between $5 million and $20 million, and enterprise values up to $120 million.  Sectors of interest include industrial products, business services, consumer products, and specialty retail.  The firm has offices in Boston and San Diego (www.bunkerhillcapital.com).

“We are very pleased with the sale of California Family Fitness and are confident that the company will continue its impressive growth trajectory,” said Rufus Clark, a Bunker Hill Managing Partner. “We are grateful to the co-founders of CFF- Russ Kuhn and Larry Gury – for partnering with us on this transaction, and to Randy Karr, Cherrie Fosco and the entire CFF management team for their hard work and devotion to the business over the years.

Perpetual Capital Partners, the buyer of CFF, acquires and makes growth equity investments in companies with a minimum of $2 million of annual cash flow. Sectors of interest include media and communications; distribution and logistics; business and financial services; and branded products including consumer goods and services, and industrial products. The firm is headquartered in Arlington, VA (www.perpetualcapitalpartners.com).

Perpetual Capital Partners is backed by the Allbritton family and is related to other investments of the family including Allbritton Communications Company, a media company that holds broadcast television and other assets throughout the country including WJLA-TV/NewsChannel 8 in Washington, DC, and POLITICO, a new media political news website and newspaper.

Piper Jaffrey & Co. (www.piperjaffray.com) advised CFF and Bunker Hill on the sale to Perpetual Capital Partners.

© 2016 PEPD • Private Equity’s Leading News Magazine • 1-8-16

Sentinel Exits Northeast Dental

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Sentinel Capital Partners has sold Northeast Dental Management to Dental Care Alliance, a portfolio company of Harvest Partners.

Northeast Dental Management (NEDM) – acquired by Sentinel in April 2012 – provides administrative staffing, human resources, purchasing, financial, and information technology support services to 65 locally-branded dental offices in Connecticut, Massachusetts, Maryland, New York, New Jersey, Pennsylvania, and Virginia. The company is headquartered north of Newark in Paramus, NJ (www.nedentalmanagement.com).

During Sentinel’s term of ownership, the number of offices served by NEDM grew from 29 to 65 through 24 add-on affiliations which increased the company’s office density in the northeast Amtrak corridor and expanded its service offering into Maryland, Massachusetts, and Connecticut.

“Sentinel has given us the guidance and support needed to grow our business,” said NEDM Chief Executive Officer, Dr. Craig Abramowitz. “Together, we have created a strong, integrated platform capable of providing our dentists with topflight administrative support that allows them to provide their patients with the highest level of dental care.”

Sentinel Capital Partners invests in middle market companies in the United States and Canada in partnership with management. The firm 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 services, and industrials. The firm is headquartered in New York (www.sentinelpartners.com).

Dental Care Alliance, the buyer of NEDM, was acquired in July 2015 by Harvest from Quad-C Management. Today, the company is one of the largest dental support organizations in the US with 157 dental offices located in eight states supporting over 382 dentists.  Back office business support services include human resources, marketing, purchasing, accounting and insurance management.  DCA’s dental practices provide general dentistry, hygiene, pediatric dentistry, orthodontics, endodontics, periodontics and oral surgery.  The company was founded in 1991 and is headquartered in Sarasota (www.dentalcarealliance.com).

Harvest Partners currently manages approximately $2 billion of equity and structured capital and is investing its sixth private equity fund.  Harvest targets investments in companies with $20 million to $75 million of EBITDA and total enterprise values of $100 million to $750 million.  Sectors of interest include industrial & energy services; manufacturing & distribution; consumer & business services; and healthcare services.  The firm was founded in 1981 and is based in New York with an additional office in Palo Alto (www.harvestpartners.com).

© 2016 PEPD • Private Equity’s Leading News Magazine • 1-8-16

Audax Sells Chesapeake IRB to Linden

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Audax Private Equity has completed the sale of Chesapeake IRB – a provider of institutional review board services for human subjects in clinical trials – to Linden Capital Partners. Audax acquired the company in May 2013.

Chesapeake IRB provides its legally-mandated IRB services to pharmaceutical, biotech, and medical device companies; contract research organizations; institutions; and academic medical centers. The company is accredited by the Association for the Accreditation of Human Research Protection Programs. Chesapeake IRB is headquartered in Columbia, MD (www.chesapeakeirb.com).

During Audax’s term of investment the company completed three add-on acquisitions which expanded Chesapeake’s market share and geographic reach across the United States and Canada. “Audax’ continued support and expertise in executing its buy and build strategy was extremely valuable as we expanded our market share and geographic reach over the past three years,” said Jeff Wendel, President & CEO of Chesapeake.

“Jeff Wendel and the Chesapeake team have done a tremendous job in building a differentiated market leader in the IRB space through acquisitions and organic growth,” said Geoffrey Rehnert, Co-CEO of Audax Group.

The Audax Group makes control investments of $10 million to $100 million in middle market companies with transaction values of $25 million to $500 million. Sectors of interest include industrial manufacturing; energy; outsourced industrial services; consumer products; healthcare devices and services; non-asset based logistics; technology; aerospace & defense; business services; and direct marketing. The firm was founded in 1999 and has offices in Boston and New York (www.audaxgroup.com).

Linden Capital Partners – the buyer of Chesapeake IRB – is focused exclusively on leveraged buyouts in the healthcare and life science industries. Linden’s strategy is based upon three elements: healthcare and life science industry specialization; integrated private equity and operating expertise; and strategic relationships with large corporations.

In March 2015, Linden closed its third private equity fund, Linden Capital Partners III, LP at the oversubscribed hard cap of $750 million. The original target for the new fund was $600 million. Fundraising for the new fund took less than 3 months. Linden closed its first fund of $200 million in 2005 and its second fund of $375 million in 2010. The firm is based in Chicago (www.lindenllc.com).

Goulston & Storrs served as legal counsel to Audax. Houlihan Lokey advised Chesapeake and Audax. Kirkland & Ellis served as legal counsel to Linden.

© 2016 PEPD • Private Equity’s Leading News Magazine • 1-6-16

Encore Consumer Capital Sells FreshKO

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Encore Consumer Capital has completed the sale of its portfolio company, FreshKO Produce Services – a distributor of fresh produce – to C&S Wholesale Grocers.

FreshKO is a distributor of fresh produce and produce-related items to independent retailers and small grocery chains in Central and Northern California.  The company was founded by its CEO Randal Shepherd and is headquartered in Fresno, CA (www.FreshkoProduce.com).

“Encore has been a great partner over the past three years. They’ve helped us expand our team, our footprint and capabilities,” said Mr. Shepherd.

“It has been a great pleasure for us at Encore to have partnered with Randal Shepherd, Manny Robles and the rest of the team at FreshKO since our investment in 2012. Their ability to expand FreshKO’s customer base and attract a strong partner like C&S exceeded our expectations,” said Scott Sellers, Managing Director of Encore Consumer Capital.

C&S Wholesale Grocers is one of the largest wholesale grocery supply company in the US. Founded in 1918 as a supplier to independent grocery stores, C&S now services customers of all sizes, supplying approximately 6,500 independent supermarkets, chain stores, military bases, and institutions with over 170,000 different products. The company is headquartered in Keene, NH (www.cswg.com).

Encore Consumer Capital invests exclusively in consumer products companies that have revenues between $10 million and $100 million and where it can utilize its own consumer experience and the expertise of its operating partners at Encore Associates, a strategic advisory firm to the consumer products industry. The firm has raised nearly $600 million in equity capital and invested in 24 platform companies.  Encore was founded in 2005 and is headquartered in San Francisco (www.encoreconsumercapital.com).

© 2015 PEPD • Private Equity’s Leading News Magazine • 12-21-15

Century Park Exits Lynx Grills

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Century Park Capital Partners has sold Lynx Grills, a manufacturer of commercial and residential kitchen equipment, to publicly traded Middleby Corp.

Lynx manufactures and markets stainless steel outdoor kitchen products and accessories. The company’s products – sold under the brands Lynx Professional Grills and Sedona by Lynx – include a complete line of outdoor grill platforms, cocktail carts, outdoor refrigerators and other beverage service and storage products. Lynx distributes its products nationwide through a network of national and regional hearth and patio dealers, appliance dealers, specialty retailers and distributors. The company is led by CEO Jim Buch and is headquartered near Los Angeles in Downey, CA (www.lynxgrills.com).

“Lynx has evolved into the leading luxury brand in the outdoor kitchen market. Jim Buch and his team have done a terrific job executing on the opportunity to build a world class company in this space,” said Chip Roellig, Managing Partner with Century Park.

Century Park invests from $10 million to $50 million in middle-market companies that have revenues of $20 million to $100 million and EBITDA of $4 million to $15 million.  Sectors of interest include chemicals, medical products and services, business services, industrials, and consumer products. The firm is based in Los Angeles (www.centuryparkcapital.com).

“I am grateful to Century Park for their unwavering support of Lynx, especially through the downturn, their collaborative approach to strategy, and their willingness to take risks and make investments in growth,” said Mr. Buch.

Middleby Corp. (NASDAQ: MIDD), the buyer of Lynx Grills, manufactures commercial cooking equipment, industrial processing equipment, and residential appliances. The company is headquartered outside of Chicago in Elgin, IL (www.middleby.com).

William Blair and Company (www.williamblair.com) was the financial advisor to Lynx on this transaction.

© 2015 PEPD • Private Equity’s Leading News Magazine • 12-18-15

Arlington Capital Sells MB Aerospace to Blackstone

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Arlington Capital Partners has sold MB Aerospace, a Tier I engine component manufacturer and repair business, to Blackstone. Arlington Capital first invested in the company in April 2013.

MB Aerospace is a provider of engineered components – complex rings, casings and other engine parts – for the commercial and military aero-engine and industrial gas turbine markets. Customers include Pratt & Whitney, Rolls-Royce, General Electric, Boeing, United Technologies Aerospace Systems, Mitsubishi Heavy Industries, and the US Department of Defense. The company is led by its CEO Craig Gallagher who has held the position since 2003. MB Aerospace has facilities in the US, UK, and Poland and is headquartered near Glasgow in Motherwell, UK (www.mbaerospace.com).

During Arlington Capital’s term of ownership MB Aerospace acquired two businesses. In April 2014 the company acquired Norbert Industries, an aero-engine component manufacturing business based in Sterling Heights, MI; and in June 2013 acquired Delta Industries, an aero-engine component manufacturing business based in Hartford, CT.

“MB Aerospace has been a blueprint investment for Arlington Capital. We partnered with an outstanding management team to be an early consolidator in a large and rapidly growing market with a differentiated product offering and together, we have built one of the largest independent pure-play aero-engine component manufacturers,” said Peter Manos, a Managing Partner at Arlington Capital Partners.

Arlington Capital Partners has $1.5 billion of committed capital and invests in buyouts and recapitalizations of companies valued from $50 million to $500 million. Sectors of interest include government services and technology, aerospace & defense, healthcare, and business services & software.  MB Aerospace will be the fourth exit for Arlington Capital in the last twelve months and continues an active year for the firm which also made three new platform investments. Arlington Capital is based in Chevy Chase, MD (www.arlingtoncap.com).

“Our partnership with Arlington Capital has been a tremendous success for both MB Aerospace and Arlington Capital,” said Mr. Gallagher. “Arlington Capital has provided substantial capital to help us grow, while allowing us to leverage their network of industry experts, deep sector knowledge and other resources to accelerate MB Aerospace on its path to record sales.”

Blackstone, the buyer of MB Aerospace, is one of the world’s largest investment and advisory firms. The firm’s alternative asset management businesses include the management of private equity funds, real estate funds, hedge fund solutions, credit-focused funds and closed-end funds. Blackstone also provides various financial advisory services, including financial and strategic advisory, restructuring and reorganization advisory and fund placement services. Blackstone’s private equity business in total manages more than $91 billion in equity as of the end of the third quarter 2015. Blackstone is headquartered in New York (www.blackstone.com).

© 2015 PEPD • Private Equity’s Leading News Magazine • 12-18-15