Monthly Archives: December 2007

Edgewater Announces Sale of Compass Environmental to WRS

CHICAGO – Edgewater Growth Capital Partners has announced the sale of portfolio company Compass Environmental to WRS Infrastructure & Environment.

WRS is an environmental remediation company backed by Equity Group Investments, which is a Chicago-based investment firm founded and led by Sam Zell. Edgewater partnered with Compass’ CEO through an investment in 2003.

Since that time, Compass has become one of the fastest-growing and largest privately held environmental remediation companies in the U.S. The transaction expands the capabilities of both companies and enhances their combined position within the high-growth, public- and private-sector markets.

The sale to WRS created the opportunity for Edgewater to make an investment in WRS to build further value from Edgewater’s investment in this industry. Compass is another example of Edgewater’s investment strategy.

The company was introduced to Edgewater through a personal relationship with one of Edgewater’s partners and the investment was negotiated on favorable terms to Edgewater without an auction process.

Throughout the investment life, Edgewater assisted in the recruitment of senior management and the generation of dozens of business opportunities that created growth and value in the business.

The company successfully expanded both organically and through the 2004 acquisition of Williams Environmental Services. Edgewater will actively assist the combined entity in its continued growth and success.

The Edgewater Funds Acquires American Laser Centers

FARMINGTON HILLS, Mich., Dec. 10 /PRNewswire/—American Laser Centers, the largest provider of laser hair removal and other noninvasive aesthetic services in the United States, announced it has been acquired by Chicago-based private equity firms Code Hennessy & Simmons LLC (“CHS”) and The Edgewater Funds. Specializing in private equity investments and recapitalizations of middle market companies in partnership with management, CHS and The Edgewater Funds become the majority owners of the company.

As part of the ownership transfer process, Gary Graves has been appointed CEO to succeed Founder and CEO Rich Morgan. Prior to joining American Laser Centers, Mr. Graves was CEO of Chicago-based La Petite Academy, Inc., the second largest for-profit preschool educational center which operates 645 schools in 36 states and the District of Columbia, where he gained significant expertise marketing to a female customer base. Prior to that, Mr. Graves was COO of InterPark, the world’s premier owner, manager, and developer of parking facilities. In addition, he has a strong multi-location business management background holding top positions at Boston Market, PepsiCo and Yum Brands. Mr. Graves currently serves as a non-executive Chairman of the Board for Caribou Coffee and is an independent member of Caribou Coffee’s Board of Directors.

“I am eager to lead American Laser Centers,” said Mr. Graves. “This is an exciting time in the aesthetic treatment industry and it is rewarding to be at the helm of the leader in the space.”

Mr. Morgan adds, “To continue American Laser Centers’ rapid growth and expansion, Gary brings a wealth of relevant experience with major consumer brands and the female market paired with a keen understanding of operational efficiency. We know his skills are essential to building upon our strong brand identity and executing our vision to remain the leader in non-surgical cosmetic procedures.”

CHS is a private equity firm, founded in 1988 that manages more than $2.5 billion in capital across five different funds. The Edgewater Funds is a private equity firm with $1 billion in capital. CHS and The Edgewater Funds will provide strategic direction for American Laser Centers through active roles on the Board of Directors.

American Laser Centers was ranked in Inc Magazine’s 2007 list of the fastest-growing private companies in the U.S. and ranked sixth highest in the state of Michigan. The company has experienced more than 53 percent year-over-year sales growth, and performs approximately 75,000 treatments each month.

About American Laser Centers 

American Laser Centers is the largest and most successful laser hair removal, skin rejuvenation and cellulite reduction therapy company, with more than 220 locations in the United States. The company has performed more than two million aesthetic treatments since its founding in 2002. American Laser Centers offers clients treatments using state-of-the-art-technology under a doctor-supervised regimen. American Laser Centers is proud to offer the industry’s only written two-year guarantee for laser hair removal. For more information, please visit http://www.americanlaser.com/.

Edgewater Acquires Horsburgh & Scott Co.

CHICAGO – Edgewater Growth Capital Partners II LP is pleased to announce the recently completed acquisition of Horsburgh & Scott Co. (H&S), which is headquartered in Cleveland. H&S is a leading manufacturer of large-diameter industrial gears and custom mechanical gear drives.

The company also provides specialized services including heat treatment, technical solutions and on-site customer service. The acquisition was completed in partnership with Edgewater affiliate Bolder Capital LLC and the management team at H&S.

H&S products are used in a variety of applications in the steel, mining, sugar, aluminum and power-generation industries.

The company’s large-diameter gears also are critical components for alternative power-generating wind turbines, which represents a high-growth opportunity for H&S. Edgewater is working closely with management to further grow the business by investing in equipment to open up new end-user markets.

Edgewater Funds Gets Drink Concentrate Maker Beverage House

Cartersville, Ga.–Chicago buyout shop Edgewater Funds has gulped down Beverage House Inc., a company that mixes and packages concentrates of liquid tea, coffee, health drinks and other beverages, for an undisclosed amount.

Edgewater Funds is buying the Cartersville, Ga.-based company from a broad group of private shareholders that was looking for an exit, according to Mark Loeffler, a principal at VRA Partners LLC, the Atlanta investment bank that advised the sellers. Members of management, however, are retaining a stake and continuing with the company.

Beverage House formulates drink concentrates for its clients, which include foodservice companies and retailers, and packages them in boxes or plastic bags before being shipped out. No details about its finances were disclosed.

Edgewater was attracted to the company largely due to its activity in teas and other healthy beverages, which are seeing better growth as more Americans choose alternatives to soda and other sugary drinks. As a result, Beverage House has experienced sales growth of about 40% on average over the last four years, according to Dave Tolmie, a partner at Edgewater Funds.

The company has also carved out a nice niche in the tea, coffee and herbal beverage space, a feature that places it on a short list of concentrate manufacturers that companies go to when they need a mix made.

“We also like how much its customers value the capabilities that the company has to develop a superior product,” Tolmie said. “They are a leader in what they do.”

Edgewater Funds is viewing the company as a platform for acquisitions of other makers of “value-added” beverage ingredients, Tolmie said. The firm also plans on making investments to upgrade the company’s manufacturing facility.

Beverage House generated significant interest from both strategic and financial buyers, largely due to a leading position in the space, Loeffler said. In addition, a diverse customer base protects Beverage House from a downside.

Edgewater Funds is investing out of its Edgewater Growth Capital Partners II LP, a $470 million partnership raised last year.