Bethesda, MD - January 2, 2004 - American Capital Strategies Ltd. (Nasdaq:ACAS)announced today it has invested $68 million in the buyout of Specialty Brands of America, Inc. ("SBA"), a leading specialty grocery packaged goods company. American Capital's investment takes the form of senior term debt, senior and junior subordinated debt, redeemable preferred stock and common equity. American Capital is also providing a revolving credit facility. SBA management is making a significant equity investment. Post closing, American Capital will own 77.5% of SBA on a fully diluted basis.
SBA is the leading marketer of maple syrup and sugar free syrups worldwide, with the Spring Tree®, Cary's®, and MacDonaldsTM brands. SBA also markets Original Trenton Crackers®, Dixie Fry® Coating Mix, New York Flatbreads®, and Canoleo® Margarine.
"Specialty Brands of America Inc. was American Capital's seventh buyout and 27th new portfolio company of 2003," said COO Ira Wagner. "We are pleased to be investing in some of the leading brand names in their categories and backing an experienced, innovative management team."
American Capital invested over $1 billion in 2003 and over $400 million in the fourth quarter of 2003.
For more information about American Capital's portfolio click here.
"SBA owns the leading, top performing brands in their segments and is capitalizing on the growth of those markets," said American Capital Managing Director Brian Graff. "Additionally, the company's scaleable, variable cost platform provides substantial leverage and cost advantages relative to competing brands. Its management team has implemented a successful acquisition strategy based on these attributes."
"SBA's broad distribution and highly diversified revenue stream ensures that it is not dependent on specific accounts," said American Capital Managing Director Robert Klein. "At the same time, the company maintains exceptionally strong customer relationships based on supporting successful brands with consistent promotion. The Company's leading position in its growing markets and ability to drive new products through established distribution bode well for the future."
Founded in 1991 and based in Westbury, NY, SBA has built a leading branded specialty foods company through acquisitions and internal growth. The company has seen consistent earnings growth of approximately 12% annually over the past several years. SBA entered the syrup category by acquiring from Borden Inc. the leading U.S. sugar free table syrup brands, Cary's® Sugar Free Syrup and Cary's® and MacDonald'sTM pure maple syrup. The company subsequently acquired Spring Tree Corporation, and with it, obtained the leading pure maple syrup brand in the U.S., Spring Tree® Pure Maple Syrup and the rapidly growing Spring Tree® Low Calorie Sugar Free Syrup. SBA's syrups can be found in the U.S. in just about every grocery store, in the leading breakfast restaurant chains, and in 18 countries. The company's other brands include Original Trenton Crackers®, a 150-year old line of distinctive oyster and wine crackers; Dixie Fry®, a brand of chicken and fish coating mix; Canoleo®, a canola oil based margarine; and New York Flatbreads®, a unique and delicious crispbread distributed nationwide in retail stores and upscale restaurants. The Company's customers include all of the leading retailers and wholesalers in the U.S.
"American Capital is the investment partner we need to continue to implement our growth strategy," said founder and CEO Dom Bastien. "We look forward to a mutually rewarding partnership."
For more information about SBA's line of delicious specialty foods click here.
As of December 31, 2003, American Capital shareholders have enjoyed a total return of 246% since the Company's IPO - an annualized return of 22%, assuming reinvestment of dividends. American Capital has declared a total of $13.12 per share in dividends since its August 1997 IPO.
American Capital is a publicly traded buyout and mezzanine fund with capital resources in excess of $2.5 billion. American Capital is an equity partner in management and employee buyouts; invests in private equity sponsored buyouts, and provides capital directly to private and small public companies. American Capital provides senior debt, mezzanine debt and equity to fund growth, acquisitions and recapitalizations.
Companies interested in learning more about American Capital's flexible financing should contact Mark Opel, Principal, at (800) 248-9340, or visit our website.
This press release contains forward-looking statements. 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.
