Bethesda, MD - May 10, 2002 - American Capital Strategies Ltd. (Nasdaq:ACAS) announced today that it has invested $19.5 million in Stravina Operating Company LLC, a leading designer and supplier of impulse-purchase novelty and souvenir items. American Capital's investment takes the form of senior subordinated debt and common equity and is part of the acquisition of Stravina by Blue Capital Management LLC from Milestone Partners. Crescent Private Capital is also providing common equity. Union Bank of California is the senior lender. Stravina management is rolling over a significant portion of its common equity.
Stravina, based in Chatsworth, CA, is the leading supplier in its categories to mass merchants and large chains. The company sells to five of the top ten retailers in the U.S., and has seen sales increase significantly over the past several years. Among the company's products are personalized key chains, photo frames, pens, pencils, rulers and Post-It notes, all adorned with individual names. Its souvenir products, sold at national parks, major theme parks, and airport and hotel gift stores, include magnets, key chains, pottery, plush toys and shot glasses.
"Stravina is our second mezzanine investment this year in support of a private equity fund," said American Capital COO Ira Wagner. "Our low cost capital and our ability to execute due diligence efficiently and thoroughly positions us as an excellent partner for equity sponsors. We are backing the leading company in a fragmented niche industry, and we are pleased to be working with an outstanding management team and a strong equity sponsor."
American Capital has invested approximately $450 million in middle market companies in the last twelve months.
For more information about American Capital's portfolio click here.
"American Capital is investing in a strong management team well situated to grow their company," said American Capital Principal and Managing Director Jeri J. Harman. "Stravina is the leading supplier of personalized novelty and souvenir items to the mass channel on a national level. This, combined with the complex systems they have mastered for name management, fulfillment, and inventory tracking and reprocessing, are significant competitive advantages for the company. In addition, Stravina's personalized products and low price points have allowed it to weather the broad economic downturn well."
"American Capital's backing, along with our other investment partners, allows us to continue our growth strategy," said Sheldon Morick, Stravina President and CEO. "We see growth resulting from acquiring new mass market customers, expanding our existing relationships, and new product development."
For more information about Stravina and its more than 900 product lines, click here.
American Capital is a publicly traded buyout and mezzanine fund with capital resources exceeding $1 billion. American Capital is an equity partner in management and employee buyouts; invests in debt and equity of companies led by private equity firms, and provides capital directly to private and small public companies. American Capital funds growth, acquisitions and recapitalizations. The Company has paid and declared $8.98 per share in dividends since going public in 1997.
Companies interested in learning more about American Capital's flexible financing and ability to provide senior debt, subordinated debt and equity should contact Mark Opel, Principal, at (800) 248-9340, or visit our website.This press release contains forward-looking statements. The statements regarding expected results of American Capital Strategies are subject to various factors and uncertainties, including the uncertainties associated with the timing of transaction closings, changes in interest rates, availability of transactions, changes in regional or national economic conditions, or changes in the conditions of the industries in which American Capital has made investments.
