Blackstreet Buys Pennysaver Assets
Amidst print sector decline, the distressed investor bets on shoppers.
January 15, 2010
Amidst dislocation in the print media sector, distressed investor Blackstreet Capital Management, LLC purchased the assets of Pennysaver Group, Inc. out of bankruptcy. Terms of the transaction were not disclosed.
The Hanover, Maryland-based publisher of direct mail shopper publisher was formerly a portfolio company of the New York City-based private equity investment firm SV Investment Partners. SV Investment, formerly known as Schroder Ventures US, acquired the publisher in April 2006.
Blackstreet Capital founder and managing partner Murry N. Gunty and principal Lawrence S. Berger led the transaction for the Bethesda, Maryland-based firm.
In speaking with Mergers & Acquisitions, Berger said he expects the company will face growth opportunities as a results of efforts to “increase circulation and increase advertising.” He noted the difficulty advertisers face in trying to reach local customers and said the medium is more effective than web advertising or local newspapers.
Gunty was formerly a general partner at the midmarket firm Jacobson Partners, L.P. Berger joined Blackstreet Capital in 2006, following a career at Boston Consulting Group Inc. and The Washington Post.
The transaction is the first acquisition using capital raised from Blackstreet’s second fund, Blackstreet Capital Partners II, LP. The fund raised $91 million of equity capital in 2008, and is targeting $125 million.
Formerly known as Milestone Capital Management, LLC, the private equity firm changed its name to Blackstreet Capital Management in February 2007 following its spinout from Milestone Merchant Partners, LLC. Blackstreet currently manages about $200 million in capital.
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