American Capital Receives $54 Million from the Sale of Specialty Brands of America and Generates a 17% Return on its Investment
BETHESDA, Md., May 5, 2014 /PRNewswire/ -- American Capital, Ltd. (Nasdaq: ACAS) ("American Capital") announced today that its portfolio company BCCK Holdings, Inc., parent to Specialty Brands of America, Inc. (collectively "SBA" or the "Company"), was sold to B&G Foods (NYSE: BGS), a manufacturer, marketer and distributor of high-quality, branded shelf-stable foods. American Capital and its affiliated funds received $93 million in equity proceeds and realized a gain of $60 million from the transaction, subject to post-closing adjustments. Of the total proceeds, American Capital received $54 million in equity proceeds, realizing a gain of $35 million from the transaction, subject to post-closing adjustments. American Capital also recognized $20 million of dividend income and additional realized gains over the life of its investment. American Capital's compounded annual rate of return earned on its debt and equity securities over the life of its investment was 17%, including interest, realized gains and fees. American Capital received 2.2 times its equity investment, and realized a compounded annual rate of return of 19% over the life of its equity investment, including dividends and fees. Evercore acted as exclusive financial advisor to American Capital on the transaction.
"We are delighted with the results of our investment in SBA and proud of how the Company excelled throughout our investment and solidified its leading position within the packaged foods industry," said Brian Graff, American Capital Senior Managing Director. "Our investment in SBA is an excellent example of American Capital's One Stop Buyout® strategy of investing in middle market companies with strong market positions and partnering with management teams to enhance performance, grow operations and create value."
SBA is a leading packaged foods company with a portfolio of strong and differentiated brands. SBA's largest brand is Bear Creek Country Kitchens ("Bear Creek"). Bear Creek is the leading brand of hearty dry soups in the United States and also offers a line of savory pasta dishes and hearty rice dishes. SBA is also a leading marketer of maple syrup and sugar free syrups worldwide, with the Spring Tree® and Cary's® brands. The Company's brands also include New York Flatbreads and Canoleo margarine.
"Since our initial investment in 2003, we helped SBA achieve significant growth through acquisitions, new product launches and existing product enhancements," said Jim Gregory, American Capital Principal, Buyouts Group. "We are pleased to have supported SBA's successful acquisition and integration of Bear Creek in 2005, which resulted in a new suite of nationally known food products as well as significant operational synergies. SBA owns leading brands in the pure maple syrup, sugar free table syrup and hearty dry soups categories and we believe it is a direct fit for B&G Foods' family of top brands."
Dom Bastien, SBA Founder and Chief Executive Officer said, "Our close working relationship with American Capital allowed us to significantly invest in our business to drive growth. We worked together to expand our product offering, enhance distribution efficiencies and ultimately increase our profitability. They understood our strategic vision for SBA and our products and together worked with us to advance SBA and as such, we are poised for even more growth under B&G Foods' leadership."
American Capital invested $68 million in the One Stop Buyout® of SBA in December 2003. American Capital's investment took the form of a revolving credit facility, senior term debt, senior and junior subordinated debt, redeemable preferred stock and common equity. In May 2005, American Capital invested an additional $55 million in a revolving credit facility, senior term loans, senior and junior subordinated debt and convertible preferred equity to support SBA's acquisition of Bear Creek. For more information on American Capital's investment, visit http://www.americancapital.com/our-portfolio/specialty-brands-america-inc.
Since American Capital's 1997 IPO through the fourth quarter of 2013, it has earned a 10% compounded annual return, including interest, dividends, fees and net gains, on over 370 realizations of senior debt, subordinated debt, equity and structured products investments, totaling $20 billion of committed capital. American Capital earned a 24% compounded annual return on the exit of its equity investments, including dividends, fees and net gains. For a chart showing a partial listing of American Capital's exited portfolio companies, please go to http://www.americancapital.com/our-portfolio/exited-companies.
ABOUT AMERICAN CAPITAL
American Capital, Ltd. (Nasdaq: ACAS) is a publicly traded private equity firm and global asset manager. American Capital, both directly and through its asset management business, originates, underwrites and manages investments in middle market private equity, leveraged finance, real estate, energy & infrastructure and structured products. American Capital manages $19 billion of assets, including assets on its balance sheet and fee earning assets under management by affiliated managers, with $93 billion of total assets under management (including levered assets). Through an affiliate, American Capital manages publicly traded American Capital Agency Corp. (Nasdaq: AGNC) with approximately $9 billion of net book value, American Capital Mortgage Investment Corp. (Nasdaq: MTGE) with approximately $1 billion of net book value and American Capital Senior Floating, Ltd. (Nasdaq: ACSF). From its eight offices in the U.S. and Europe, American Capital and its affiliate, European Capital, will consider investment opportunities from $10 million to $750 million. For further information, please refer to www.AmericanCapital.com.
This press release contains forward-looking statements. The statements regarding expected results of American Capital are subject to various factors and uncertainties, including the uncertainties associated with the timing of transaction closings, changes in interest rates, availability of transactions, changes in regional, national or international economic conditions, or changes in the conditions of the industries in which American Capital has made investments.
Contact: (212) 213-2009
Brian Graff, Senior Managing Director
Jim Gregory, Principal, Buyouts Group
SOURCE American Capital, Ltd.