Pfingsten Buys Tropitone

Pfingsten Partners has led a buyout of Tropitone Furniture Company Inc., an Irvine, Calif.-based designer and manufacturer of upscale casual outdoor furniture sold under the Tropitone and Basta Sole brands. No financial terms were disclosed for the deal, which included co-investments from HarbourVest Partners and DuPont Capital Management. Tropitone was advised by Lincoln International.

 

PRESS RELEASE
Private equity firm Pfingsten Partners, L.L.C. and co-investors HarbourVest Partners LLC and DuPont Capital Management Corporation today announced the acquisition of Tropitone Furniture Co., Inc., an Irvine, CA-based designer and manufacturer of upscale casual outdoor furniture sold under the Tropitone and Basta Sole brands. Pfingsten plans to build the business through a combination of organic growth, add-on acquisitions, use of Pfingsten's Hong Kong office to increase offshore product sourcing, and other operational initiatives.

Founded in 1954, Tropitone serves the commercial and specialty retail sectors, including upscale lodging, cruise ship and country club customers as well as premium casual furniture stores. Tropitone's diversified customer base, focus on high-end market segments, strong management team, and multiple opportunities for expansion made it an attractive candidate for acquisition.

Under the terms of the agreement, Tropitone will remain headquartered in Irvine, California, and retain the 600-plus employees at its manufacturing facilities in Irvine and Temecula, CA, and Sarasota, FL, as well as its showroom in Chicago's Merchandise Mart. Michael L. Echolds, Tropitone's chief executive officer, will remain in his current role and retain significant ownership in the company, while founding family members Doug and Angella Baker will retire from the business.

“Tropitone is an established player in an industry that is growing by more than 5% annually, and the fragmented nature of the industry offers ample opportunities for growth through strategies ranging from expanding product offerings and entering new channels to acquiring complementary businesses,“ said John H. Underwood, Managing Director, Pfingsten Partners L.L.C. “This is a strong platform acquisition that we believe has the potential to become the leader in high-end outdoor furniture.“

“We decided earlier this year to seek an institutional owner with the financial resources to help us accelerate our growth, but we were also looking for an investor with the operations expertise and strategic capabilities to support our growth plan,“ Echolds said. “Pfingsten's focus on collaborative business planning, its in-house operating team and its history of growing its portfolio companies fit those criteria precisely, giving us the tools we need to take the company to the next level.“

The transaction closed on October 24. Financial terms were not disclosed. Tropitone was represented by Chicago-based investment bank Lincoln International L.L.C.

About Pfingsten Partners

Deerfield, Illinois-based Pfingsten Partners is an operationally oriented private equity firm, formed in 1989, which makes equity investments in middle market manufacturing, distribution and business-to-business service companies. Since completing its first investment in 1991, Pfingsten Partners has acquired 55 companies and built value by providing capital, corporate finance and operating resources necessary to improve operations and achieve profitable business growth at its platform companies in partnership with management. For more information, visit www.pfingstenpartners.com.

About HarbourVest Partners

HarbourVest Partners, LLC is an independent global private equity investment firm and an SEC registered investment advisor, providing vehicles for institutional investors to invest in the venture capital and buyout markets in the U.S., Europe, and elsewhere through primary partnerships, secondary purchases, and direct investments. HarbourVest and its subsidiaries have 170 employees, including 65 investment professionals deployed in Boston, London, and Hong Kong. In 25 years of investing in private equity, the team has committed more than $17.6 billion to newly formed funds, representing relationships with 200 private equity managers. The team has also completed over $3.9 billion in secondary purchases of partnership interests and invested $3.1 billion directly in operating companies. The firm's clients consist of 240 institutional investors, including pension funds, endowments, foundations, and financial institutions throughout the U.S., Canada, Europe, Australia, and Japan. To learn more, visit www.harbourvest.com.

About DuPont Capital Management Corporation

DuPont Capital Management (DCM), originally charged with overseeing the DuPont Corporation's institutional pension assets, has evolved over the past thirty-one years into a competitive, diverse, and agile investment group uniquely positioned to offer other investors the benefits of the firm's experience. DCM, an SEC registered investment advisor, currently manages more than $28 billion in assets across a wide spectrum of capitalization, geography, and asset classes. DCM applies value-based global investment capabilities that combine valuation and risk control disciplines, within and across asset classes and international boundaries, to produce risk-efficient excess returns that satisfy its clients' investment objectives. In addition to investing in Private Equity assets, the firm's equity products include U.S. Large Cap, Mid Cap, Small Cap and International and Emerging Markets. Its global fixed income products include Core, Core Plus and High Yield strategies. For more information, visit www.dupontcapital.com.

About Tropitone

Founded in 1954, Tropitone is based in Irvine, California, and is recognized throughout the casual furniture marketplace for its design leadership as well as its commitment to service and value. The company sells its products to retailers, designers and the hospitality trade under the Tropitone and Basta Sole trademarks. In addition to its headquarters and manufacturing plant in Irvine, the company operates a manufacturing facility in Sarasota, Florida. For more information about the company, visit www.tropitone.com.