Bethesda, MD -- American Capital Strategies, Ltd. (Nasdaq:ACAS) announced today it has invested $30,000,000 in the form of seven-year senior subordinated debt with warrants to finance the continued growth of Cornell Companies, Inc. (NYSE: CRN). Cornell is one of the leading private sector providers of correctional, juvenile detention, pre-release and treatment services in the United States. The Teachers Insurance and Annuity Association-College Retirement Equities Fund (TIAA-CREF) is investing $10 million in senior subordinated debt with warrants alongside American Capital. TIAA-CREF is the world's largest retirement system with over $290 billion in assets under management.
"Cornell is a unique company which has distinguished itself by combining the highest levels of performance in an operationally difficult sector with outstanding financial performance," said American Capital President and COO Adam Blumenthal. "Cornell joins the group of middle-market public companies for which American Capital's ability to provide junior capital based on assets, cash flow performance, and thorough due diligence is important for their continued growth."
"Cornell has an excellent operational history, strong and deep management, and operates in an industry that has grown at over 30% per year over the past 10 years," said American Capital Principal Darin Winn. "Cornell has expanded throughout the country both through organic growth and by identifying and acquiring the strongest entities in juvenile and adult corrections, and replicating best practices on a nationwide basis. As a result, its performance is supported by hundreds of contracts with states, counties, cities, and federal agencies. The company is well positioned to take advantage of the growing demand for more effective management of corrections nationwide."
"American Capital's investment provides long-term junior capital, which allows Cornell to continue to build, own and operate new correctional facilities," said Cornell President and CEO Steven W. Logan. "We are pleased to have initiated this partnership and look forward to a productive working relationship."
American Capital is a publicly traded buyout and mezzanine fund. 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.
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.
Capital.com, Inc., funded by investments from American Capital Strategies, Ltd. (Nasdaq:ACAS) and First Union Corp. (NYSE: FTU), is a business finance portal where premier financing sources compete to provide receivable and inventory financing, machinery and equipment loans and leasing, real estate and construction financing, subordinated debt and equity financing for growth, acquisitions, management buyouts, liquidity, recapitalizations, ESOP transactions and SBA loans. Companies in need of financing or information about financial services should contact Capital.com at info@Capital.com, or call Harry Kelly, vice president, at (646) 935-1100.
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.
