Portfolio Companies
Previous Portfolio Companies
Associated Freezers Corporation
E.D. Smith & Sons, Limited
Kenra, Ltd.
Pacific Coast Publishing Inc.
Procaps, LP
Stantec Inc.
Associated Freezers Corporation
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A Public Refrigerated Warehouse (“PRW”) Company.
Imperial Capital acquired Associated Freezers (“AF”) in July 1996 as its platform company in the PRW industry. Annual revenues and EBITDA in the year preceding Imperial Capital’s acquisition of AF were approximately $24.0 million and $8.7 million, respectively. AF consisted of 10 warehouses, comprising 19.5 million cubic feet of PRW space. After a year of extensive operational improvements and restructuring, in March 1997 Imperial Capital completed a $47 million public income trust offering on the Toronto Stock Exchange. In addition, pursuant to a management contract with the Trust following the public offering, the principals of Imperial Capital led four follow-on acquisitions, thereby tripling the size of the business.
Investment Thesis
To form a North America-wide PRW and distribution network through the acquisition and development of strategically located warehouses with state-of-the-art logistics management technology and strategic relationships with independent carriers, thereby providing frozen food manufacturers, distributors and retailers with seamless market coverage.
Current Status
In 2000, Associated Freezers Income Trust was merged with Atlas Cold Storage to form ACS Income Trust. At that time, the merged entity was the largest public refrigerated warehousing company in Canada and third largest in North America. In 2006, the trust was taken private by Avion Group hf, an Icelandic company with extensive holdings in transportation and logistics solutions worldwide.
Website: www.atlascold.com
E.D. Smith & Sons, Limited
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A Canadian-based Food Processor Specializing in Jams and Sauces
In January 2002, E.D. Smith & Sons Limited (“EDS”) was acquired as a platform for growth and consolidation in the shelf-stable food products industry. Established in 1882, EDS has been one of Canada’s largest private food companies, with leading positions in jam (jellies, pie fillings), sauces (pasta, barbeque), and ketchup. In addition, the company has strong market positions in salsas, syrups, and salad dressings. It is also one of Canada’s largest private label food companies. After this transaction, Imperial Capital spearheaded the search for strategic follow-on acquisitions, which resulted in the February 2005 acquisition of North Coast Processing, Ltd., a leading American private label salad dressing manufacturer. EDS undertook an initial public offering (“IPO”) as an income trust on the Toronto Stock Exchange in June 2005. Subsequent to the IPO, EDS acquired Seaforth Creamery, a transaction initiated by Imperial Capital, to become the leading private label salad dressing manufacturer in North America.
Investment Thesis
The vision was to transform EDS into a leading North American private label manufacturer in high growth food categories serving the higher growth perimeter of grocery stores.
Current Status
As a public entity, the business went on to acquire two other Canadian food processors which effectively doubled the size of the overall business. In October 2007, E.D. Smith Income Trust was acquired by Treehouse Foods Inc. (NYSE:THS).
Website: www.edsmith.com
Kenra, Ltd.
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A Leading Manufacturer and Marketer of Professional and Ethnic Hair Care Products.
The operating assets of Kenra were acquired by Imperial Capital in February 2007. Kenra, based in Indianapolis, has produced and marketed professional hair care products since 1959. Together with its flagship Kenra brand, the company produces and markets the Kenra Platinum line of products, consisting of advanced shampoos, conditioners and styling formulas for colour-treated and damaged hair. Kenra also produces and markets Elasta QP, a line of ethnically-oriented hair care products. Kenra’s products are marketed to professional salons throughout North America and have had significant regional success in specific areas throughout America, including the Midwest, the Southeast and California. Imperial Capital believes the company has a strong brand that will be able to further penetrate the North American market, and that the company represents a strong platform for future growth.
Investment Thesis
The vision for Kenra is to capitalize on the strength of the Kenra brand by growing sales in under-penetrated geographic markets and distribution channels throughout the United States and Canada, and to acquire companies in the professional hair care segment that provide product diversification or benefit from Kenra’s existing channels of distribution.
Website: www.kenra.com
Pacific Coast Publishing Inc.
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An Independent Yellow Pages Publisher.
YPTel was a holding company formed in 1998 by Imperial Capital to acquire the assets of PCP, the 9th largest independent yellow pages publisher in North America. YPTel was merged in February 2000 with ACG (parent of Great Western Directories, the 8th largest independent yellow pages publisher) and WorldPages.com (i.e. Big Stuff, Inc. and Web YP, Inc.) to form WorldPages.com Inc., publicly listed on the New York Stock Exchange. This created the fourth largest American independent yellow pages publisher, with an integrated print and internet yellow pages publishing platform.
Investment Thesis
A compelling vision was generated to consolidate the independent yellow pages directory industry and form a national integrated print and internet yellow pages directory company with a centralized digital production centre and national sales system.
Current Status
YPTel was merged with ACG in February 2002 to form WorldPages.com Inc., which traded under the ticker WPZ on the NYSE. In late 2002, Worldpages.com Inc. was subsequently acquired by TransWestern Publishing Company LLC, who was in turn acquired by Yellow Book USA in 2005.
Website: www.worldpages.com
Procaps, LP
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A Canadian-based Manufacturer, Marketer and International Distributor of Paintball Produc
In March 2005, the assets of Procaps Encapsulation Inc. and Airtech Industries Inc. were acquired to form Procaps as a platform for growth in the sporting goods industry. Procaps, headquartered in Montreal, Canada, is the world’s largest manufacturer of paintballs, and is a marketer and full-line distributor of paintball products, including masks and goggles. Procaps created its own American distribution network in early 2006, Procaps Direct, which is now the 3rd largest distribution company in the American paintball industry. Procaps Direct now has six climate-controlled warehouses, has expanded its product offering to 1,000 product SKUs, and has over 1,000 dealers in the US. In addition, Procaps has an approximate 30% share of the European paintball market.
Investment Thesis
The vision for Procaps is to grow the business organically throughout North America and internationally and to pursue consolidation opportunities either within the paintball sector or within the broader sporting goods industry in North America.
Website: www.procapsdirect.com
Stantec Inc. (Formerly Stanley Technology Group Inc.)
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An International, Diversified Professional Engineering Consulting Services Firm.
In December 1993, Stantec (“STN”) was acquired as the platform for consolidating the professional engineering consulting services industry. STN is a knowledge-based professional consulting services company providing solutions to infrastructure and facilities projects with capital budgets under $100 million. In March 1994, STN was taken public through an initial public offering on the Toronto Stock Exchange. STN has been profitable every year since 1954, has completed projects in over 80 countries, and has completed numerous acquisitions.
Investment Thesis
The vision for the investment was to: consolidate the fee-for-service engineering consulting industry in North America; deliver high value-added specialty services through a network of strategically located offices; and to weave the company into all stages of the infrastructure planning cycles of those communities.
Current Status
STN currently trades as a public company on the Toronto Stock Exchange under the symbol STN and on the New York Stock Exchange under the symbol SXC. STN’s services are offered through over 6,500 employees operating out of more than 100 locations in North America. In 2006, STN reported EBITDA of $111 million on $817 million of gross revenue and has a market capitalization of approximately $1.5 billion. STN’s goal is to be one of the top 10 global design firms by 2008.
Website: www.stantec.com
