Flexstone Investors Reap Returns from Deal Exits
Flexstone Partners, the co-investment specialist and an affiliate of Natixis Investment Managers, has exited a number of its US investments in recent months, providing significant distributions to its investors. Amongst these exits are co-investments in Zywave, LYNX Franchising, DLTR Villa, TricorBraun, Ferraro Foods, and Velocity Clinical Research, 6 deals done with 6 different General Partners.
Flexstone sold its investment in Zywave, a Milwaukee provider of SaaS solutions. Flexstone invested $13m in Zywave in December 2013 alongside lead investor Aurora Capital. Thanks to Zywave’s recession-resistant model which includes recurring revenues from its insurance brokerage clients, Flexstone’s fund received 2.9x its invested capital1 following the exit in November 2020.
Flexstone exited its investment in Georgia-based LYNX Franchising, a multi-brand provider of business-to-business commercial services. The stake was sold when majority ownership of LYNX was transferred to MidOcean Partners, a US mid-market private equity fund. Flexstone made a $12m investment in October 2016. The exit multiple1 in December 2020 was 3.5x.
An $11m investment in DLTR Villa in December 2012, produced a gross return on investment1 of 2.6x for Flexstone investors. DTLR Villa, majority owned by BRS & Co and Goode Capital, was sold to JD Sports Fashion for $495 million, as Britain’s biggest sportswear retailer expands its presence in the US market. Flexstone had initially invested in Sneaker Villa and after growing from 55 to 125 locations, the company merged with its largest competitor, DTLR, on August 14, 2017, creating the largest “city specialty” retailer of athletic footwear that currently operates 247 stores across 19 states and Washington DC Flexstone exited its investment in March 2021.
Meanwhile, Flexstone reaped a 2.3x return1 for its $13.4m investment in TricorBraun. a provider and distributor of packaging to the food and beverage industry was acquired by Ares Management Corporation’s Private Equity Group and Ontario Teachers’ Pension Plan Board. Since its establishment, TricorBraun has grown to more than 1,100 team members in 50 locations throughout North America, Europe and Asia. Flexstone initially invested in TricorBraun in November 2016 and exited the investment in March 2021.
In April 2021, Flexstone sold its stake in Ferraro Foods. It invested $15m in Ferraro, an Italian foodservice distributor in May 2018, alongside lead investor Kainos Capital. The gross return on investment1 was 2.4x.
Finally, Velocity Clinical Research, in which Flexstone invested $8m in December 2018, was acquired by GHO in April 2021. Velocity is a clinical research site company focusing on trials for respiratory and central nervous system therapies. Headquartered in Durham, North Carolina, Velocity operates 16 fully owned sites across 11 US states. The gross return on investment1 for Flexstone investors was 6.8x.
“These exits, and the consequent returns to our investors, are testament to our philosophy of co-investing in deals that are within the sweet spot of their lead sponsor, and building well-diversified portfolios.” says Benoit Jacquin, Managing Partner at Flexstone Partners.
For further reading:
1 Exit multiples are presented on a gross basis, and do not reflect management fees, carried interest, transaction costs and other expenses that may be paid by investors, which will result in lower net multiple for them. Past performance does not guarantee future results. Investing in a fund involves significant risks, including loss of all your investment.
About Flexstone Partners (“Flexstone”)
Flexstone is a leading investment solutions provider in private assets with a global reach and local footprints in New York, Paris, Geneva, and Singapore. It specializes in the selection of private equity, private debt, real estate, and infrastructure fund managers for investment by Flexstone’s clients.
Flexstone sold its investment in Zywave, a Milwaukee provider of SaaS solutions. Flexstone invested $13m in Zywave in December 2013 alongside lead investor Aurora Capital. Thanks to Zywave’s recession-resistant model which includes recurring revenues from its insurance brokerage clients, Flexstone’s fund received 2.9x its invested capital1 following the exit in November 2020.
Flexstone exited its investment in Georgia-based LYNX Franchising, a multi-brand provider of business-to-business commercial services. The stake was sold when majority ownership of LYNX was transferred to MidOcean Partners, a US mid-market private equity fund. Flexstone made a $12m investment in October 2016. The exit multiple1 in December 2020 was 3.5x.
An $11m investment in DLTR Villa in December 2012, produced a gross return on investment1 of 2.6x for Flexstone investors. DTLR Villa, majority owned by BRS & Co and Goode Capital, was sold to JD Sports Fashion for $495 million, as Britain’s biggest sportswear retailer expands its presence in the US market. Flexstone had initially invested in Sneaker Villa and after growing from 55 to 125 locations, the company merged with its largest competitor, DTLR, on August 14, 2017, creating the largest “city specialty” retailer of athletic footwear that currently operates 247 stores across 19 states and Washington DC Flexstone exited its investment in March 2021.
Meanwhile, Flexstone reaped a 2.3x return1 for its $13.4m investment in TricorBraun. a provider and distributor of packaging to the food and beverage industry was acquired by Ares Management Corporation’s Private Equity Group and Ontario Teachers’ Pension Plan Board. Since its establishment, TricorBraun has grown to more than 1,100 team members in 50 locations throughout North America, Europe and Asia. Flexstone initially invested in TricorBraun in November 2016 and exited the investment in March 2021.
In April 2021, Flexstone sold its stake in Ferraro Foods. It invested $15m in Ferraro, an Italian foodservice distributor in May 2018, alongside lead investor Kainos Capital. The gross return on investment1 was 2.4x.
Finally, Velocity Clinical Research, in which Flexstone invested $8m in December 2018, was acquired by GHO in April 2021. Velocity is a clinical research site company focusing on trials for respiratory and central nervous system therapies. Headquartered in Durham, North Carolina, Velocity operates 16 fully owned sites across 11 US states. The gross return on investment1 for Flexstone investors was 6.8x.
“These exits, and the consequent returns to our investors, are testament to our philosophy of co-investing in deals that are within the sweet spot of their lead sponsor, and building well-diversified portfolios.” says Benoit Jacquin, Managing Partner at Flexstone Partners.
For further reading:
- Flexstone makes co-investments in the US and Europe for its global opportunities strategy
- Flexstone Co-Invests in Takeover of NutriSystem
- Flexstone Increases Investment in Vaccine Logistics
- Flexstone Partners Completes 100th Co-Investment
- Flexstone Expands Portfolio with Stakes in Power Services and Biotech
- Flexstone Invests in Two Deals in US and Europe
About Flexstone Partners (“Flexstone”)
Flexstone is a leading investment solutions provider in private assets with a global reach and local footprints in New York, Paris, Geneva, and Singapore. It specializes in the selection of private equity, private debt, real estate, and infrastructure fund managers for investment by Flexstone’s clients.
Flexstone manages primary and secondary investments as well as co-investments. Flexstone’s expertise is distinguished by a high flexibility in building customized portfolios that are tailored to the unique needs and constraints of each investor whether institutional or private individual. Flexstone offers a large range of services, from advising on private assets portfolio construction to the management of fully discretionary separate accounts and funds of funds.
Flexstone, with more than 40 professionals, manages or advises $8.1 billion*. It is a majority owned subsidiary of Natixis Investment Managers, one of the largest investment managers worldwide.
Further information: www.flexstonepartners.com
*Source: Flexstone Partners at 08/31/2020. Assets under management and advisory made up of commitments for closed-end private placement funds, and sum of Net Asset Value and unfunded commitments otherwise.
Flexstone Partners
An affiliate of Natixis Investment Managers
Flexstone Partners, SAS – Paris
Investment management company regulated by the Autorité des Marchés Financiers. It is a simplified stock corporation under French law with a share capital of 1,000,000 euros Under n° GP-07000028 –Trade register n°494 738 750 (RCS Paris)
5/7, rue Monttessuy,
75007 Paris
www.flexstonepartners.com
Flexstone Partners, SàRL – Geneva
Independent (unregulated) asset manager, under Swiss Federal Act on Collective Investment Schemes (“CISA”), supervised by Commission de haute surveillance de la prévoyance professionnelle (“CHS PP” and regulated by the Swiss Financial Market Supervisory Authority (“FINMA”) under Anti Money Laundering requirements. It is a limited liability company with a share capital of 750 000 CHF.
Trade register n° CH-660-0180005-1
8 chemin de Blandonnet
Vernier 1214 Geneva
Switzerland
Flexstone Partners, LLC - New York
Delaware corporation, registered with the United States Securities and Exchange Commission as an investment adviser
28th floor of 745 Fifth Avenue, New York, NY 10151.
Flexstone Partners, PTE Ltd - Singapore
61 Robinson Road, #08-01A Robinson Centre
Singapore 068893
Natixis Investment Managers
RCS Paris 453 952 681
Share Capital: €178 251 690
43 avenue Pierre Mendès France
75013 Paris
www.im.natixis.com
This communication is for information only and is intended for investment service providers or other Professional Clients. The analyses and opinions referenced herein represent the subjective views of the author as referenced unless stated otherwise and are subject to change. There can be no assurance that developments will transpire as may be forecasted in this material.
Copyright © 2021 Natixis Investment Managers S.A. – All rights reserved
Flexstone, with more than 40 professionals, manages or advises $8.1 billion*. It is a majority owned subsidiary of Natixis Investment Managers, one of the largest investment managers worldwide.
Further information: www.flexstonepartners.com
*Source: Flexstone Partners at 08/31/2020. Assets under management and advisory made up of commitments for closed-end private placement funds, and sum of Net Asset Value and unfunded commitments otherwise.
Flexstone Partners
An affiliate of Natixis Investment Managers
Flexstone Partners, SAS – Paris
Investment management company regulated by the Autorité des Marchés Financiers. It is a simplified stock corporation under French law with a share capital of 1,000,000 euros Under n° GP-07000028 –Trade register n°494 738 750 (RCS Paris)
5/7, rue Monttessuy,
75007 Paris
www.flexstonepartners.com
Flexstone Partners, SàRL – Geneva
Independent (unregulated) asset manager, under Swiss Federal Act on Collective Investment Schemes (“CISA”), supervised by Commission de haute surveillance de la prévoyance professionnelle (“CHS PP” and regulated by the Swiss Financial Market Supervisory Authority (“FINMA”) under Anti Money Laundering requirements. It is a limited liability company with a share capital of 750 000 CHF.
Trade register n° CH-660-0180005-1
8 chemin de Blandonnet
Vernier 1214 Geneva
Switzerland
Flexstone Partners, LLC - New York
Delaware corporation, registered with the United States Securities and Exchange Commission as an investment adviser
28th floor of 745 Fifth Avenue, New York, NY 10151.
Flexstone Partners, PTE Ltd - Singapore
61 Robinson Road, #08-01A Robinson Centre
Singapore 068893
Natixis Investment Managers
RCS Paris 453 952 681
Share Capital: €178 251 690
43 avenue Pierre Mendès France
75013 Paris
www.im.natixis.com
This communication is for information only and is intended for investment service providers or other Professional Clients. The analyses and opinions referenced herein represent the subjective views of the author as referenced unless stated otherwise and are subject to change. There can be no assurance that developments will transpire as may be forecasted in this material.
Copyright © 2021 Natixis Investment Managers S.A. – All rights reserved