BETHESDA, Md., Nov. 3 /PRNewswire/ -- American Capital Strategies (Nasdaq:ACAS) announced today that it has funded the acquisition of Federal Packing Company, Inc., by Euro-Caribe Packing Company, Inc. creating the largest independent producer of processed pork products in Puerto Rico. A portion of the proceeds of the loan will be used for the refinancing of existing debt of Euro-Caribe. The company's Con Gusto and El Serranito brands are sold in Puerto Rico and in the United States. American Capital's substantially new investment, in the form of bridge senior debt and subordinated debt with warrants, provided all of the capital required to close the transaction. The total credit facility including a revolving line of credit, is $18 million.
Euro-Caribe was formed in 1974 by its current owners, Jose Casanova and Wolfgang Kell. Federal Packing was formed in 1967 by Gabriel Cadenas, whose family has operated the business continuously since that time. Mr. Casanova and Mr. Kell will continue to operate the combined company. A portion of the equity will be held by San Juan Holdings, Inc., a New York and Puerto Rico based investment banking firm that sponsored the transaction.
Euro-Caribe is expected to benefit from production and marketing synergies. Federal is primarily a manufacturer of cooked hams and other specialty meat products manufactured for Puerto Rican tastes, while Euro- Caribe has developed a leading market share in both cooked and fresh sausages. American Capital Principal Ginger Rollins commented, "Euro-Caribe's production facilities are bursting at the seams, while Federal has significant additional production capacity. The two companies distribute to similar customers, with virtually no overlap in product line. Both companies have respected, premium brand names. American Capital expects significant synergies to result from combining the companies."
President of Euro-Caribe Packing Company Jose Casanova said, "We have a natural recipe for success. Wolfgang and I founded this company twenty-five years ago and have invested and built the business over that time. This is our first significant acquisition and we believe that American Capital will be a great partner for us as we accelerate our growth."
Adam Blumenthal, Executive Vice President of American Capital, further commented, "Wolfgang and Jose are the kind of dedicated entrepreneurs American Capital is proud to finance. Our fourth quarter is off to a great start. We have now deployed and committed $138 million of the $155 million raised in our initial public offering in 15 months, well ahead of our plan. We recently secured a credit facility during difficult market conditions and we continue our mission to invest in middle market companies in need of capital for expansion. Our quantity and quality of opportunities continue to increase and we have just completed a transaction that demonstrates our flexibility, commitment to thorough due diligence and perseverance to close the deal. We are pleased to add Euro-Caribe Packing Company to our portfolio."
American Capital is a buyout and specialty finance company with capital resources exceeding $175 million. American Capital invests $1 to $20 million in the form of senior debt, subordinated debt and equity to middle market companies in need of capital for growth, acquisitions, employee buyouts, management buyouts, liquidity and restructurings. Companies interested in learning more about American Capital and its unique and flexible financing should contact John Hoffmire, Vice President of Sales and Marketing, at 781-862-4447 or visit its Web site at www.American-Capital.com or its shareholder site at www. ACAS1.com.
This press release contains forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The statements regarding expected results of American Capital Strategies 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 or national economic conditions, or changes in the conditions of the industries in which American Capital has made investments.
