Southfield Capital has acquired Vanguard Dealer Services, a provider of automotive related extended warranty products. Vanguard’s senior management team comprised of CEO Jim Polley, along with Ed Reitz and Mike Seergy, co-invested alongside Southfield in this transaction.
Vanguard is an agent and administrator of finance and insurance products and services to franchised automobile dealers. Vanguard offers a portfolio of proprietary and third party auto extended warranty (vehicle service contracts) and ancillary products such as tire protection, key replacement, dent repair and pre-paid maintenance. The company also offers other financial and insurance consulting services to dealers such as training, compensation plan development, reinsurance, incentive management, sales strategy, compliance review, and staffing. Vanguard was founded in 1999 and is headquartered just west of New York City in Fairfield, NJ (www.vanguarddealerservices.com).
“We have ambitious plans to grow Vanguard into the nation’s preeminent provider of finance and insurance products and services through a combination of acquisitions and the introduction of new products and services,” said Mr. Polley. “We needed a partner that has experience executing roll-up strategies and the operational expertise to ensure that we scale the business appropriately as we grow. Southfield’s excellent track record with companies similar to Vanguard gave us confidence that they are the right partner for us.”
“Jim Polley and his management team have developed a fantastic business which is now positioned for accelerated growth,” said Southfield Partner, Andy Cook. “Vanguard is a mission critical vendor to automotive dealers that increasingly rely on Vanguard’s products and services to drive profitability. Vanguard represents a compelling platform investment in a large and highly fragmented market.”
Southfield Capital provides capital for majority recapitalizations and management-led buyouts of lower middle-market businesses. The firm makes control investments of $10 million to $40 million of equity in transactions with $20 million to $100 million of enterprise value. Typical target companies will have from $4 million to $12 million of EBITDA. Sectors of interest include: business services; consumer products & services; distribution & fulfillment; energy; healthcare; media & entertainment; niche manufacturing; power & infrastructure; specialty finance; and specialty retail. Southfield Capital was founded in 2005 as the successor company to the private investment firm Levison & Company and is headquartered in Greenwich, CT (www.southfieldcapital.com).
Senior financing for this acquisition was provided by East West Bank (www.eastwestbank.com) and subordinated debt was provided by Fidus Investment Corporation (www.fdus.com). Woodbridge International (www.woodbridgegrp.com) was the financial advisor to Vanguard and its shareholders.
2015 PEPD • Private Equity’s Leading News Magazine • 8-21-15