Altamont Inks Debut Deal out of New Fund
The San Francisco-based private equity firm acquires the used car and finance business of J.D. Byrider with its $500 million fund.
May 4, 2011
It has taken Altamont Capital Partners a few months to seal a deal for its debut fund. The firm’s $500 million fund, which closed in January, picked up the used car sales and finance company, J.D. Byrider, for an undisclosed amount.
The 20 year old family business, which is based out of Carmel, Indiana, has 114 franchised and 13 company owned dealerships in 29 states. It also provides its customers with special auto financing.
According to its website, the company’s system wide revenues came in at $740 million last year. The corporate side pulled in approximately $179 million, said Bill Brunner, J.D. Byrider’s CFO.
J.D. Byrider’s current president of franchising Steven Wedding will move into the CEO spot and the rest of the management team will stay in place. One family member, James F. DeVoe, Jr., will remain on the board of directors and will serve as a consultant to the business.
The company had to overcome a couple of challenges over the years. First, its founder died in a plane crash in 2006 and then its family members had to deal with the recession. Coming out of the economic downturn the family realized that it was time to take the business to the next level, said Brunner. The executive explained that the company wasn’t large enough to go public and decided that a private equity partner would be more ideal.
The company sought the help from the investment bank Stephens Inc., which helped the company run a limited auction. Six firms were interviewed and J.D. Byrider picked Altamont because of the firm’s appetite for growth. Stephens’ managing director John Nagy was the lead banker on the deal.
J.D. Byrider turned to Barnes & Thornburg for legal advice. David Millard was the lead counsel on the transaction.
Now that the dealership has the backing it needs the company will carry on with its growth plans which includes acquiring some of its franchisees and expanding company owned stores. Acquiring other brands is not part of the agenda, Brunner noted.
Altamont’s managing director, Keoni Schwartz stated in the press release that J.D. Byrider is ripe for growth and will work at getting it to its full potential.
The firm was established in 2010 by private equity experts, Jesse Rogers, Randall and Schwartz who all came from Golden Gate Capital and Bain & Company. The firm has set out to invest in middle market business stemming from an array of sectors. In an earlier press release Altamont stated that it will spend between $10 million to $75 million on its investments, preferably acquiring a controlling stake.
Altamont’s team has experience within the financial services, consumer retail, industrial, healthcare and the business services space. In February, the firm hired Thomas Weisel Partners’ former COO and president, Lionel Conacher, to focus on investment opportunities in Canada.
The firm did not return calls seeking comment by press time.
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