Double the deals

Dec 01, 2006 10:30 PM  By

Sixteen mergers and acquisitions took place during the third quarter, double the number of transactions that occurred during the third quarter of last year. But according to Craig Battle, managing director of Princeton, NJ-based investment bank Tucker Alexander, which tracks deal activity for Multichannel Merchant, “it’s more of the same we’ve had for the past few years, with the high end driven by private equity funds buying larger companies they would call platform acquisitions, off of which they plan to grow both organically and through outside acquisitions.”

Once more into the breach for Bachrach

When: August The facts: Chicago-based Bachrach, a 129-year-old cataloger/retailer of men’s apparel, was sold by an affiliate of Boca Raton, FL-based investment firm Sun Capital Partners to “Bachrach Acquisition,” a limited-liability company, for an undisclosed price. According to the Bachrach Website, Bachrach Acquisition is a group of private investors headed by Brian Lipman, who is now the company’s president/CEO. In a rare move, Sun Capital — which bought a sizable percentage of Bachrach in February 2005 — filed Chapter 11 bankruptcy for Bachrach in June. “Sun Capital specializes in buying underperforming companies they feel have solid market positions but maybe are being poorly managed,” Battle says. Sun had hoped to build out Bachrach’s retail sales, but after a year, “the business was listing badly. [Bachrach] filed for bankruptcy… and a company bought it out of bankruptcy,” he says. The skinny: The new owners have their work cut out for them, according to Battle: “In the last several years, there has been a resurgence in the men’s apparel business, but it doesn’t seem to have impacted Bachrach.”

New imprint for Broder Bros.

When: September The facts: Imprintable sportswear distributor Broder Bros. acquired Amtex Imports, a Northlake, IL-based competitor. Trevose, PA-based Broder Bros. paid about $6.8 million for Amtex, a $40 million single-location distributor with approximately 40 employees. The acquisition of Amtex facilitates Broder Bros.’ expansion into the Chicago market; the company has in fact leased a 425,000-sq.-ft. distribution facility in Chicago. Broder Bros. is itself owned by Boston-based private equity firm Bain Capital, which acquired it in May 2000. “Typically Bain is interested in buying a company with a strong market position that will serve as a platform to make other acquisitions,” Battle says. “They basically got right to it” with Broder Bros., which during the past few years has acquired major competitors NES Clothing Co. and Alpha Shirt Holdings as well as smaller companies such as Full Line Distributors and T-Shirts & More. The skinny: Sources say Amtex Imports must have been struggling, considering the bargain-basement price tag.

Life Uniform buys new outfit

When: July The facts: Life Uniform Co., an affiliate of Boca Raton, FL-based investment firm Sun Capital Partners, acquired Tampa, FL-based competitor Uniform City Corps. Sun Capital had purchased cataloger/retailer Life Uniform from Angelica Corp. in July 2004. Life Uniform and Uniform City both sell work apparel to healthcare professionals via stores, catalogs, and the Internet. M. Steven Liff, managing director for Sun Capital Partners, said in a statement: “The Uniform City acquisition is an excellent fit for Life Uniform, allowing Life to become not only a leading retailer of scrub wear and complementary products but a leader in the catalog segment as well.” The skinny: Life Uniform has 196 stores in 35 states; Uniform City, which primarily sells to medical and hospital professionals, has eight retail outlets.

3Q 2006 CATALOG INDUSTRY TRANSACTIONS
Company Market segment Buyer/investor Investment form Est. price (in millions)
JULY Illuminations Scented candles and home decor Yankee Candle Co. Acq. of assets $22.0
Mackenzie Ltd. Gourmet food Astral Foods Acq. of assets N/A
Excelligence Learning Corp. Educational products Thoma Cressey Equity Partners Acq. of assets $125.0
Uniform City Corps Uniforms Life Uniform Co. (Sun Capital) Acq. of assets N/A
AUGUST Ashro Lifestyles Women’s apparel Swiss Colony Acq. of assets N/A
Bachrach Men’s apparel Bachrach Acquisition Acq. of assets N/A
Cinema Circle DVDs Gaiam Majority investment $6.9
Groomers.com Pet grooming supplies Pets United Acq. of assets N/A
Sweater.com Women’s apparel Hartmarx Corp. Acq. of assets $12.4
Aramark Corp. Food service; professional safety Goldman Sachs Privatization $8,300.0
Growing Family Photography Falconhead Capital Acq. of assets N/A
National AV Supply/AV Disc. Depot Audio-visual products VCOM Int’l. Multimedia Corp. Acq. of assets N/A
SEPTEMBER Carabella Corp./A.B. Lambdin Women’s apparel Golden Gate Capital Acq. of assets N/A
Amtex Imports Imprintable sportswear Broder Bros. Acq. of assets $6.8
AsiaEC Office products Office Depot Acq. of assets N/A
Berbee Information Networks Corp. IT solutions provider CDW Corp. Acq. of assets $175.0
Source: Tucker Alexander, compiled from public information and other nonconfidential sources