Gen Cap Exits ReBath
Amidst a home construction slowdown, the seller contends the remodeling sector remains solid as a result of spending patterns.
January 13, 2010
As the construction sector continues to experience mounting loses, Nashville, Tennessee-based private equity firm Gen Cap America exited its investment in ReBath and AmBath Corp., the manufacturer of bathroom remodeling products that the firm acquired in 2002. Terms of the transaction were not disclosed.
The Tempe, Arizona-based manufacturing portfolio company was sold to an investor group led by Webster Capital and backed by equity co-investor Sorenson Capital. Debt financing for the deal was provided by White Plains, New York-based Fifth Street Finance Corp.
Gen Cap president and chief executive officer Barney D. Byrd and executive vice president Donald D. Napier, III worked on the transaction for the mid-market firm.
In speaking with Mergers & Acquisitions, Napier declined to disclose Gen Cap’s return multiple or the firm’s return on investment. He told this publication that the remodeling business has benefited from the troubled state of the housing sector, as many homeowners opt to remodel bathrooms over home construction or more significant renovations.
A similar sentiment was echoed by Guardian Capital managing partner Peter H. Haabestad last week, following the Philadelphia, Pennsylvania-based buyout firm’s purchase of a control stake in Sure Fit Inc., a slipcovers and furniture accessories company.
Webster Capital general partner David P. Malm, a former general partner of Halpern, Denny & Company, and a member of the board of directors of Comfort Keepers, Jan-Pro, Vox and Freedom Eldercare, led the transaction for the Waltham, Massachusetts-based firm.
The acquisition is Webster's initial foray into the homebuilding sector. In August 2009, the firm sold Comfort Keepers to Sodexo, a food and facilities management services companies. Webster had initially purchased the portfolio company in July of 2007. In September 2008, the firm acquired Jan Pro Holdings LLC, a Alpharetta, Georgia-based commercial cleaning company. In December 2008, Webster Capital closed its second fund, Webster Capital Fund II, with $200 million in committed capital.
In January 2008, Sorenson Capital closed its second fund, Sorenson Capital Partners II, with about $400 million in committed capital. In May 2004, the buyout firm closed its initial $250 million fund.
Gen Cap used Edgeview Partners, a Charlotte, North Carolina-based middle market investment bank owned by CIT Capital Securities, LLC, as its financial advisor for the transaction. Edgeview’s deal team included managing director John Tye, director Meg Montague Lauck, vice president Gordie Vap, associate Paul Habenicht and analyst Val Matena.
Gen Cap closed its sixth fund, Southvest Fund VI, L.P., in March 2009 with $250 million in committed capital. The firm is now investing from its fifth and sixth funds.
Calls placed to Webster Capital and Sorenson Capital were not returned by press time.
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