Hanna Andersson Sold

May 01, 2001 9:30 PM  By

After 18 years as a family-owned children’s cataloger/retailer, $65 million Hanna Andersson in March sold the assets of its business. The new owner is a newly formed corporation owned by management and an investor group led by San Francisco-based private-equity firm Dorset Capital, a subsidiary of Weston Presidio. Terms of the deal were not disclosed.

According to Hanna Andersson CEO Philip Iosca, the Portland, OR-based company will use Dorset’s financial backing to grow its core business — the catalogs and the Website, which now account for 25% of sales — and to a lesser extent, to expand its retail operation.

Founder Gun Denhart “has tried to find a strategic buyer for three or four years,” says Craig Battle, managing director of Princeton, NJ-based investment bank Tucker Alexander. “The children’s sector is one of the weakest of the catalog business, and there aren’t many healthy companies in that segment.” Assuming that the terms of the recapitalization are favorable, “this could be an attractive alternative to a strategic sale. This is a positive for Hanna Andersson,” Battle says.

“I was ready to move into the next stage in my life,” says Denhart, who founded Hanna Andersson in 1983 with her husband, Tom. Gun Denhart will remain a board member and shareholder. She’ll also head the Hanna Andersson Foundation, a charitable organization supporting children and families. The company will fund the new foundation with 5% of its pretax profits.