H.I.G. Capital News
H.I.G. Capital, LLC
H.I.G. Capital, LLC
H.I.G. Capital and HALO Industries, Inc. (OTC Bulletin Board: HMLOQ), today announced the closing of the sale of HALO Branded Solutions
May 14, 2003 - H.I.G. Capital and HALO Industries, Inc. (OTC Bulletin Board: HMLOQ), today announced the closing of the sale of HALO Branded Solutions, Lee Wayne Corporation, and HALO Europe to HALO Holdings, L.L.C. (“HALO”), to an affiliate of H.I.G. Capital, a private equity investment firm located in Miami, Florida. This transaction allows the businesses to emerge from Chapter 11 and to return to normal operating status.
The total purchase price was $22 million in cash and notes, including a $3 million earn-out based on future financial performance. Net proceeds will be used by the bankruptcy estate to pay the first installment on pre-petition debt remaining from the reorganization under Chapter 11 of the United States Bankruptcy Code, which the company filed in July 2001.
This transaction completes a series of restructurings the bankruptcy estate undertook, which included the divestiture of non-core businesses and the consolidation of its order management and sales support systems. The result was a complete payoff of $74 million in bank debt, elimination of over $100 million in operating expenses and a significant improvement in the company’s operating results. Further actions to provide additional value to the estate are underway.
Marc Simon, HALO’s CEO, commented: “We are very excited about our growth opportunities with H.I.G. We have the highest quality and the most efficient order management system in the industry, and a very scalable platform for growth. H.I.G. brings the capital and expertise to grow organically through enhanced services for our current account executives, as well as a strong financial base for sensible, strategic acquisitions.”
HALO, based in Sterling, Ill., with offices in eight countries worldwide, is a leading promotional products distributor in the $16 billion per year promotional products industry. HALO has annual sales of approximately $175 million. The Company has a large and growing sales force and expects to continue its profitable growth by offering the best and most competitively priced promotional products supported by world-class operations and customer service.
Doug Berman, Managing Director of H.I.G. Capital, noted, “We have been looking for the right partnership in the promotional products industry for some time. HALO and Lee Wayne have an outstanding management team, great brand recognition and the industry’s best account executives. We are extremely excited about our investment.”
H.I.G. Capital is a leading private equity and venture capital investment firm with more than $1.5 billion of equity capital under management. Based in Miami, Florida, and with offices in Atlanta, Boston, and San Francisco, H.I.G. specializes in providing capital to small and medium-sized companies with attractive growth potential. H.I.G. invests in management-led buyouts and recapitalizations of well-established, profitable, and well-managed manufacturing or service businesses, and in promising early stage technology companies. Since its founding, H.I.G. has made more than fifty highly successful investments, acquiring companies with combined revenues in excess of $5 billion.