Bethesda, MD -- American Capital Strategies, Ltd. (Nasdaq:ACAS), today announced it invested $4.4 million in senior subordinated debt with detachable warrants and $555,000 in convertible preferred stock of The Parts Plus Group, Inc. The American Capital investment will be used to fund The Parts Plus Group's continuing acquisition program.
The Parts Plus Group, which is led by its management team and an investment group, is a rapidly growing auto parts distributor in the eastern United States. Sterling Ventures Limited and RFE Investment Partners will increase their equity investment in The Parts Plus Group in conjunction with this acquisition.
The Parts Plus Group serves new car dealers, fleets owned by municipalities and other organizations, independent and chain store repair shops, and independent auto parts retail stores. It is the largest member of The Parts Plus Association, one of the largest industry buying groups in the United States, operating from 103 locations and carrying a full line of replacement component parts for automobiles and light trucks.
American Capital Principal Ira Wagner commented, "This is a great investment in a group that is growing by acquisition and is successfully integrating each new company into their group. The Company has strengths with many different types of customers, and the seasoned management team is working closely together to expand on the individual strengths of each division across the Company. We look forward to supporting The Parts Plus Group in its continued expansion and to working with its innovative management team."
"American Capital has supported us with capital to continue to grow in a fragmented market. The financing will enable us to expand into new geographic regions and more effectively serve our customers in the Mid-Atlantic region," commented William Macey, Jr., Chairman of The Parts Plus Group and a Principal of Sterling Ventures Limited.
"In our second transaction of the quarter, we are proud to join with investors from John Hancock to support Sterling Ventures Limited, RFE Investment Partners and the management team of The Parts Plus Group. As a public company, American Capital provides one of the very few opportunities for individual investors to participate in private equity transactions of this type, and to benefit directly, through our dividend and asset growth, in the superior returns they can produce. We are pleased to add The Parts Plus Group as our 30th portfolio company," stated Adam Blumenthal, President and COO of American Capital.
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American Capital is a buyout and specialty finance company with capital resources exceeding $360 million. American Capital invests in senior debt, subordinated debt and equity in middle market companies in need of capital for growth, acquisitions, ESOP buyouts, management buyouts, liquidity and restructurings. Through www.AmericanCapitalOnline.com financing is provided to small and middle market companies in need of capital for receivable and inventory financing, working capital loans, machinery and equipment loans, real estate loans, construction financing, acquisition funding, management buyouts, ESOP financings, liquidity and restructurings.
This press release contains forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. 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.
