Continuing with its strategy to book profit by shedding mature
portfolios, private equity firm
American Capital, Ltd.
) announced yet another sell-off. The company declared the
vending of its portfolio company BCCK Holdings to New
B&G Foods Inc.
How Profitable the Deal Was?
Through this deal, American Capital and its affiliated funds
received equity proceeds worth $93 million and reaped a gain of
$60 million, subject to post-closing adjustments. Of this,
American Capital's share stood at $54 million in equity proceeds
and $35 million gain.
The company also garnered dividend income of $20 million and
additional realized gains over the life of its investment.
Further, the company earned 17% compounded annual rate of return
on its debt and equity securities over the life of its
investment. Notably, the company received 2.2 times of its
AMER CAP LTD (ACAS): Free Stock Analysis
B&G FOODS CL-A (BGS): Free Stock Analysis
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The Entry & Exit
BCCK Holdings is the parent company of Specialty Brands of
America, Inc. (commonly called SBA), one of the major firms in
the packaged foods industry. SBA's portfolio includes notable
brands like 'Bear Creek Country Kitchens' - a popular name in dry
soups and savory pasta dishes, while marketing maple syrup
and sugar free syrups globally through the Spring Tree and Cary's
American Capital's alliance with SBA dates back to Dec 2003 when
it invested $68 million as a part of its One Stop Buyout
strategy. The strategy focuses on making investments in middle
market companies and capitalizing on their robust standing in the
market while teaming up with the management teams. Notably,
SBA grew over the years through meaningful acquisitions and
expansion of its line of products.
B&G Foods, which is also in the packaged foods industry, is
engaged in manufacturing, marketing and distribution of
high-quality, branded shelf-stable food products.
Evercore Partners Inc.
) served as financial advisor to American Capital.
The latest move marked American Capital's third divestiture this
year. Prior to this, the private equity and venture capital firm
had carried out two divestitures. On Apr 2, the company sold its
interest in ADF Holdings, Inc. to
Calumet Specialty Products Partners LP
), a North America-based producer of high-quality specialty
hydrocarbon products. Alongside, on Apr 17, American Capital sold
SPL Acquisition Corp. to Shenzhen Hepalink Pharmaceutical Co.,
Ltd., one of the major suppliers of heparin sodium in the global
As private equity markets continue to rebound, we look forward to
American Capital's greater involvement in strategic investments,
which are poised to benefit the company and investors in the long