Lee Equity Partners has acquired a majority equity interest in The Living Company from TZP Group. Platform Ventures, also an investor in the company, will retain its equity stake in partnership with Lee Equity.
The Living Company, under its University Furnishings brand, is a provider of asset-light logistics services for furniture, fixtures, and equipment (FF&E) sold to off-campus student housing properties. The company also services the hospitality and workforce housing sectors. TLC’s FF&E services include design/layout, sourcing, kitting, warehousing, delivery, installation, replacement, and rehabilitation.
Customers of TLC include REITs, management companies, purchasing groups, developers, general contractors, designers and individual owner-operators. Within the off-campus student housing sector, TLC has an installed base of more than 600,000 rooms at more than 2,000 properties serving many of the largest student housing developers, owners, and managers in the United States.
TLC is led by CEO Paul Dougan and is headquartered near Dallas in Garland, TX. The company’s management team will continue to operate the business and they are maintaining an equity interest in the company.
“Since our founding in 2003, TLC has been one of the fastest-growing and most successful asset-light logistics providers of FF&E due to our longstanding industry experience and commitment to high-quality custom solutions,” said Mr. Dougan. “Our national scale and local knowledge allow us to reliably reduce supply chain complexity and provide project completion certainty. With Lee Equity’s knowledge and experience in the hospitality services industry and asset-light real estate services, we look forward to continuing to serve the student housing and hospitality industries and expanding into additional markets.”
Asset-light real estate services is a focus area for Lee Equity and the buy of TLC follows the firm’s successful investment in Aimbridge Hospitality, a provider of third-party hotel management services to more than 25,000 hotel rooms in the US and Caribbean, that was sold to Advent International in January 2019.
Lee Equity focuses on control buyouts and growth capital financings, typically investing $50 million to $100 million of equity per transaction in US-based companies with enterprise values of $100 million to $300 million. Sectors of interest include business services; distribution and logistics; financial services; and healthcare services.
“TLC has an impressive reputation with clients given their strong value proposition as a risk manager and their exceptional, decade-long on-time delivery and installation track record,” said Yoo Jin Kim, a partner at Lee Equity. “We look forward to working with Paul and the entire TLC team to accelerate their FF&E business in hospitality, workforce housing, senior living and other sectors.”
According to Lee Equity, with its asset-light business model, market-leading positions, and competitive differentiation, TLC is well-positioned for continued organic and acquisition-driven growth. Lee Equity is headquartered in New York and over the past decade has invested $1.7 billion in more than 20 lower middle-market companies and 50 add-on acquisitions.
TZP invested in TLC (then University Furnishings) in January 2016 through its second fund, TZP Capital Partners II LP. “The evolution of University Furnishings into The Living Company has been truly extraordinary and has been a direct result of the strong partnership we formed with Paul Dougan, Lisa Dillon, James Garner, and their strategic partner Platform Ventures,” said Dan Galpern, a partner at TZP. “We are looking forward to celebrating the continued success of TLC and are truly grateful for the time we have shared with this remarkable team.”
Platform Ventures, which is maintaining its minority equity interest in TLC, is a New York-based growth equity investment and advisory firm. Sectors of interest include consumer products, business services, and technology.
TZP Group makes control investments of between $20 million and $100 million in companies with enterprise values between $50 million and $250 million and EBITDA between $8 million and $35 million. Sectors of interest include business and consumer services. The firm is headquartered in New York.
The Living Company was advised by Baird & Co. and Greenberg Traurig provided legal services.
© 2019 Private Equity Professional | October 15, 2019
