Flexstone, an affiliate of Natixis Investment Managers, invested $10m in Fitzmark, the Indianapolis-based logistics provider. Founded in 2006, FitzMark is a tech-enabled third-party logistics provider serving more than 2,000 shippers and 25,000 carriers. The new capital will enable Fitzmark to gain scale by acquiring similar businesses, make senior hires and expand its proprietary technology.
The US logistics market is huge and growing. The trucking market alone is worth $400bn and freight brokerage, the activity in which Fitzmark specialises, is a $70bn submarket. “The market is fragmented with more than 5,000 small freight firms so there is ample M&A opportunity,” says David Marcus, a New York-based Managing Director, Investments at Flexstone.
Flexstone invested alongside lead sponsor Calera Capital, which has proven experience of the logistics sector. Marcus says: “We have invested with Calera since 2008 and we are very aware of what expertise they can bring to opportunities. Calera has an operating partner who has run a large logistics business, so we have a lot of comfort about this deal, as it is firmly in Calera’s sweet spot.”
Flexstone only co-invests when the deal is in the sweet spot of the lead investor: that is, the lead investor has specific skills and successful experience of a sector and deal type.
Prior to the Fitzmark deal, Flexstone co-invested in seven acquisitions alongside Calera Capital. Five of these deals have already been exited, providing a cumulative gross return of 2.4x their capital invested and a gross IRR of 24%.
Flexstone has also invested in Funecap Groupe, the second largest funeral care services company in France with a significant market share. Funecap, which employs more than 1,500 people, has three main lines of business: funeral services, provided through a network of 600 operated and franchised outlets; the management of funeral infrastructure such as crematoria (Funecap manages around 40 crematoria under public contracts with an average length of 20 years), funeral homes and parlours; and the sale and management of pre-paid funeral contracts.
David Arcauz, a Geneva-based Managing Partner at Flexstone, says: “We like the Funecap’s story as the management team has been able within ten years to create the challenger in the French funeral care sector which is still fragmented. They have combined a dynamic roll-out growth strategy with seamless execution across the platform and are continuing to deliver on their business plan.”
The partners of the co-lead investor in the deal, Latour Capital, are both entrepreneurs and connect very well with professional management teams. Arcauz believes their experience will help enable Funecap to further expand organically and by acquisitions. The aim is to consolidate the funeral market in France whilst continuing on a dynamic growth trajectory
“There was competition to get allocation for this co-investment opportunity,” adds Arcauz. “Our speed of execution for co-investment and relationship with Latour Capital have enabled us to be well positioned and receive an attractive allocation in the deal.”
For further reading:
- 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
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.
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,
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
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
Natixis Investment Managers
RCS Paris 453 952 681
Share Capital: €178 251 690
43 avenue Pierre Mendès France
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.
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