MONOMOY CAPITAL PARTNERS ACQUIRES BARJAN PRODUCTS, LLC.
Innovative Deal Structure Facilitates
Out of Court Purchase From 13 Lenders
Contact: Sloane & Company
Keil Decker, 212-446-1875
NEW YORK--(BUSINESS WIRE)--January 9, 2006--Monomoy Capital Partners, LLC (“Monomoy”), today announced that it has completed the acquisition of Barjan Products, LLC (“Barjan” or “the Company”), a premier distributor of consumer products to travel centers, truck stops, car washes and convenience stores. Monomoy acquired the company for approximately $20 million in cash and assumed liabilities. In an unusual and complicated transaction structure, Monomoy acquired Barjan’s assets directly from a syndicate of 13 banks led by General Electric Commercial Financial Services, Inc. through a foreclosure and sale of assets under Illinois state law.
With annual revenues of over $140 million and facilities in Rock Island and East Moline, Illinois, Reno, Nevada and Atlanta, Georgia, Barjan is the largest distributor of non-food general merchandise to truck stops and travel centers across America. The Company manufactures, sources and distributes over 8,000 individual products, including automotive accessories, chemicals and additives, consumer electronics, novelty products, books, videos, and music. Barjan is the principal supplier to four of the five national travel center chains and scores of regional and local travel centers.
“We are very excited to partner with the Barjan team,” stated Daniel Collin, a Monomoy principal. “Over the past three years, the Company has delivered world class performance during a period of extraordinary financial stress. We are confident that Monomoy ownership will provide Barjan with the financial flexibility and operational expertise to improve every aspect of its operational and financial performance.”
Mark G. Essig, a turnaround manager previously retained by the company, will remain with the company and retain the role of Chief Executive Officer. Prior to joining Barjan, Mr. Essig held senior management and restructuring positions at GS Industries and AK Steel. The Company’s senior management team has made a substantial co-investment in the transaction and will have a significant ownership stake in the new Barjan.
“The Monomoy acquisition heralds a new day for a great company,” said Mr. Essig. “The Monomoy team and Barjan management have built a business program that will allow us to reduce costs, streamline operations and continue to exceed customer expectations in all aspects of distribution and marketing to the travel center, convenience store and car wash industries. We implemented a substantial portion of the plan prior to closing, and the Company is now well positioned to grow its core business in 2006.”
The transaction was executed through a “friendly foreclosure” proceeding which is a complex but less expensive alternative to bankruptcy for a certain class of asset sales. The bank group led by GE foreclosed on the Company’s assets under Article 9 of the Illinois Uniform Commercial Code and sold the assets directly to a Monomoy acquisition vehicle following a statutory notice period. The new company is called Barjan LLC.
The Barjan acquisition is the third by Monomoy since August 2005 and joins Awrey Bakeries, Inc. and Hess Industries, Inc, in the Monomoy portfolio. Richard Porter of Kirkland & Ellis, L.P. represented Monomoy in the transaction, and PNC Business Credit provided the acquisition financing. Jill Factor of Jenner & Block represented Barjan Products; Peter Knight of Latham & Watkins represented the bank agent; and Andrew Turnbull and Scott Jackson of Houlihan Lokey Howard & Zukin were the Company’s investment bankers.
“We thank Mark Essig and all of the professionals involved in this transaction for their hard work and innovative thinking over the past several weeks,” said Monomoy principal Stephen Presser. “The foreclosure sale was unusually intricate, and it could not have been accomplished without path-breaking legal work by Kirkland & Ellis and the extraordinary patience and perseverance of the entire professional team.”
About Monomoy Capital Partners
Monomoy Capital Partners is an experienced private equity group that makes controlling investments in smaller companies that require operational or financial restructuring. Monomoy targets fundamentally sound businesses with revenues less than $150 million and acquires businesses through bankruptcy, out-of-court restructurings, corporate divestitures and other complex transactions.
The principals of Monomoy – Stephen Presser, Daniel Collin, Justin Hillenbrand and Philip Von Burg – founded Monomoy in March 2005 to concentrate on special situations in the smaller end of the middle market. For additional information please visit the Monomoy Web site at www.mcpfunds.com.