Finance a Management-Led Buyout

Financial Partner to Great Management Teams

If you are looking to purchase a company where you are actively engaged as a part of the management team, or in an industry where you have considerable experience and expertise, DCA can serve as your financial partner to help finance the transaction for you.

 

In addition, by getting us involved early in the process, we can help to arrange attractive debt financing to further preserve your equity position in the acquired company, and help you negotiate optimal transaction terms.  In addition, our flexible and creative deal structures will ensure that you are appropriately rewarded for your efforts in helping the acquired company grow and become more successful.

 

Our typical investment profile:

 

Industry: Generalist, across business services; light manufacturing and distribution; healthcare; retail and consumer products; media and publishing; information technology; construction services; sustainable technology and services; and food/beverage/agri-business. DCA looks to finance buyouts where the sponsoring management team is either active in the business, or has considerable expertise in the relevant industry.

 

Geography: Underserved communities in California and adjacent states

 

Company Profile: Minimum of $10 million in revenues and profitable: (i) outstanding, proven and mature management teams; (ii) large, growing market opportunities; (iii) differentiated solutions with sustainable competitive advantages; (iv) scalable business models which are either profitable at the time of investment or have a clear, near-term path to profitability; (v) a clear path to liquidity in a five year timeframe; (vi) interests which are well-aligned between management and the Fund; and (vii) the ability for the General Partner and its General Partner Advisory Board to add significant value over the lifecycle of the investment.

Use of Capital: Leveraged or unleveraged buyouts of operating companies, divisions, or Corporate spin-offs.

 

Investment Size: Generally $2-6 million, with capacity up to $150 million through our affiliated fund partners

 

Investment Life: 3-5 years

 

Management: Experienced, talented, passionate, honest and committed

 

Investment Structure: DCA typically invests through a Preferred Equity instrument, and does not typically require any interest or dividend payments.

 

Management Control: In growth capital investments, DCA is most typically a minority (less than 50%) investor, allowing management to retain a controlling (greater than 50%) interest in the Company.  In buyouts, however, DCA may have a theoretical control position depending on the amount of leverage used to complete the buyout, the capital contributed by the management team, and the ultimate purchase terms negotiated. Even still, DCA relies on Management to lead the day-to-day operations and make traditional operating decisions.

 
Minority Investment Opportunity: Given the geographic region we cover, we also look pro-actively for opportunities to invest in minority-owned or minority-targeted enterprises, particularly those serving the rapidly expanding Hispanic community.

 

 

 

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