American Capital Closes Over $2.4 Billion in New and Extended Credit Facilities for 19 Portfolio Companies in 2012
by PR Newswire
BETHESDA, Md., Jan. 14, 2013 /PRNewswire/ -- American Capital, Ltd. (Nasdaq: ACAS) ("American Capital") announced today that in 2012 the American Capital Syndications Group was successful in closing over $2.4 billion in new and extended credit facilities for 19 of its portfolio companies. The financings helped to facilitate a variety of transactions including four dividend recaps, three add-on acquisitions for existing portfolio companies, eleven refinancings and maturity extensions and one new One Stop Buyout®. Throughout the year American Capital and its affiliates received approximately $890 million in debt and equity proceeds as a result of these transactions. These credit facilities were ultimately syndicated to approximately 80 separate lending institutions, including longstanding lending relationships of American Capital.
"Our ability to call upon a wide variety of lending institutions in order to match the specific needs of our portfolio companies with the investment profile of an appropriate group of lenders is a skill set we've developed over many years," said Jeff Schumacher, American Capital Managing Director and Group Head of Syndications. "These long-term lending relationships, in addition to the overall strength of the capital markets in 2012, allowed us to return a significant portion of capital to American Capital, while also putting in place debt-capital structures at 19 of our portfolio companies that resulted in meaningful increases in both financial and operational flexibility. Our Syndications Group has worked with a wide range of distinguished financial institutions and debt capital market investors, and we will continue to utilize this broad group of investor relationships to help facilitate transactions going forward."
A summary of select 2012 representative transactions is outlined below.
Paradigm Precision Holdings, LLC
On August 31, 2012, American Capital completed the syndication of $75 million in senior credit facilities consisting of a revolving credit facility, first-lien term loan, and second-lien term loan for portfolio company Paradigm Precision Holdings, LLC ("Paradigm"), a leading and premier global supplier of precision aerospace components for jet engine manufacturers. These facilities provide Paradigm with a stable source of financing to support the company's ongoing working capital needs and growth initiatives. American Capital received $32 million in debt proceeds from the transaction.
During the first half of 2007, American Capital and an affiliate invested $108 million in Paradigm for the One Stop Buyouts® of Smith West Inc. ("Smith West"), Palmer Manufacturing Co. Inc. ("Palmer") and Eurocast S.A. ("Eurocast"), leading manufacturers of precision machined aerospace engine components. American Capital's investment took the form of a senior credit facility, senior secured subordinated notes and common equity. In addition, in September 2008, American Capital invested in Paradigm to support the acquisition of TM Industries, Inc., a high-precision machining company that specializes in machining large size, highly technical parts for customers in the aerospace, power generation, oil and gas and defense markets.
Based in Peabody, Massachusetts with additional facilities in Malden, Massachusetts; East Berlin, Connecticut; Tempe, Arizona; Guaymas, Mexico, and; Tunis, Tunisia; Paradigm is a manufacturer of highly complex, close tolerance parts and assemblies used mainly in aircraft engine and industrial gas turbines. In addition to working with all of the major turbine engine original equipment manufacturers, the company also supplies parts used in land-based power generation and other specialty applications.
For more information on American Capital's investment in Paradigm, please go to www.americancapital.com/Pages/our_portfolio/companies/paradigm_precision_holdings.aspx
WIS Holdings Company, Inc.
On December 20, 2012, American Capital completed the syndication of $365 million in senior credit facilities consisting of a revolving credit facility, first-lien term loan, and second-lien term loan for its portfolio company WIS Holdings Company, Inc. ("WIS"), a leading global provider of outsourced inventory management services. This transaction replaced the company's existing indebtedness with a new, long-term and highly accommodating source of financing. American Capital and its affiliates received $250 million of debt and equity proceeds from the transaction.
In January 2007, American Capital and an affiliate invested $411 million in the One Stop Buyout® of WIS. American Capital's investment took the form of a revolving credit facility, senior term loan, senior subordinated debt, holding company PIK notes and common and convertible preferred equity. WIS management also invested in equity.
Headquartered in San Diego, California the company's core business is to provide the systems, technology and staff for third-party inventory verification services. WIS has U.S. headquarters in San Diego and Canadian headquarters in Toronto, Ontario. The company has over 225 offices across the U.S., Canada and internationally with operations based in the U.K., China, Japan and Mexico. WIS services large blue-chip global retailers.
For more information on American Capital's investment in WIS, please go to www.americancapital.com/Pages/our_portfolio/companies/wis_international.aspx
Affordable Care Holding Corp.
On December 26, 2012, American Capital completed the syndication of $300 million in senior credit facilities consisting of a revolving credit facility, first-lien term loan, and second-lien term loan for its portfolio company Affordable Care Holding Corp. ("Affordable Care"), a dental services organization that supports a network of affiliated dental practices providing removable prosthetics and related services. As part of this financing, Affordable Care was able to extend maturity dates on its credit facilities while negotiating a favorable covenant package, which will allow the company significant flexibility to pursue additional growth opportunities. American Capital and its affiliates received $126 million of debt and equity proceeds from the transaction.
Founded in 1975 and based in Raleigh and Kinston, North Carolina, the Affordable Care network is America's largest provider of dentures. The company currently provides dental practice management and on-site dental laboratory services supporting a network of 187 affiliated dental practices operating under the brand of Affordable Dentures. Affiliated practices currently operate in 38 states. The Affordable Care-affiliated practices provide value priced dentures and same-day service with no appointment necessary.
American Capital first invested in Affordable Care in 2006. For more information on American Capital's investment in Affordable Care, please go to www.americancapital.com/Pages/our_portfolio/companies/affordable_care.aspx
ABOUT AMERICAN CAPITAL
American Capital is a publicly traded private equity firm and global asset manager. American Capital, both directly and through its asset management business, originates, underwrites and manages investments in middle market private equity, leveraged finance, real estate and structured products. American Capital manages $18.6 billion of assets, including assets on its balance sheet and fee earning assets under management by affiliated managers, with $118 billion of total assets under management (including levered assets). From its eight offices in the U.S. and Europe, American Capital and its affiliate, European Capital, will consider investment opportunities from $10 million to $500 million. For further information, please refer to www.AmericanCapital.com.
This press release contains forward-looking statements. The statements regarding expected results of American Capital are subject to various factors and uncertainties, including the uncertainties associated with the timing of transaction closings, changes in interest rates, availability of transactions, changes in regional, national or international economic conditions, or changes in the conditions of the industries in which American Capital has made investments.
Jeff Schumacher, Managing Director and Group Head of Syndications
SOURCE American Capital, Ltd.