BETHESDA, Md., Oct. 16 /PRNewswire-FirstCall/ -- American Capital Ltd. (Nasdaq: ACAS) announced today that on October 13 it completed the sale of its portfolio company Imperial Supplies Holding Inc. to W.W. Grainger Inc. (NYSE: GWW). American Capital received $66 million in proceeds and realized a loss of $5 million during the fourth quarter from the transaction, subject to post-closing adjustments. American Capital's compounded annual rate of return, including interest, dividends and fees earned over the life of its investment was 9%. The proceeds received by American Capital were greater than the second quarter 2009 valuation of the investment by $16 million, or 34%.
"We are very pleased with the results of our equity and subordinated debt investments in Imperial Supplies," said Jeff MacDowell, Managing Director, Buyouts. "Since our initial investment in October 2007, the company has performed well, expanding its market reach, broadening its product offering and consistently increasing its market share despite the challenging macro-economic environment. Imperial Supplies' deep management team, efficient sales process and new partnership with Grainger, North America's leading broad line distributor of facilities maintenance products, will all position the company to build on its impressive history of excellence."
Imperial Supplies is a value-added distributor of after-market components to fleet and facility-based markets. American Capital first invested $112 million in the One Stop Buyout (TM) of Imperial Supplies in October 2007. American Capital's investment took the form of a revolving credit facility, a senior term loan, senior and junior subordinated debt and preferred and common equity. Shortly thereafter in December 2007, American Capital syndicated $46 million of the senior term debt and revolver commitment. For more information about American Capital's investment in Imperial Supplies, please go to http://www.americancapital.com/our_portfolio/companies/imperial_supplies.html.
Since American Capital's August 1997 IPO through the second quarter of 2009, the company has earned a 15% compounded annual return, including interest, dividends, fees and net gains, on 264 realizations of senior debt, subordinated debt and equity investments, totaling $12 billion of committed capital. These realizations represent 49% of all amounts invested by American Capital since its August 1997 IPO. Proceeds from these realizations exceeded the total associated prior quarter valuation of the investments by less than 1%. American Capital earned a 30% compounded annual return on the exit of its equity investments, including dividends, fees and net gains.
For a chart showing American Capital's exited portfolio companies, please go to http://www.americancapital.com/our_portfolio/exited.html.
ABOUT AMERICAN CAPITAL
American Capital is a publicly traded private equity firm and global asset manager. American Capital, both directly and through its asset management business, originates, underwrites and manages investments in middle market private equity, leveraged finance, real estate and structured products. Founded in 1986, American Capital has $11 billion((1) )in capital resources under management and nine offices in the U.S., Europe and Asia. For further information, please refer to www.AmericanCapital.com.
(1) As of June 30, 2009.
W.W. Grainger, Inc., with 2008 sales of $6.9 billion, is the leading broad-line supplier of facilities maintenance products serving businesses and institutions in the United States, Canada, Mexico, China, India and Panama. Through a highly integrated network including nearly 600 branches, 18 distribution centers and multiple Web sites, Grainger's employees help customers get the job done, saving them time and money by having the right products to keep their facilities running.
Performance data quoted above represents past performance of American Capital. Past performance does not guarantee future results and the investment return and principal value of an investment in American Capital will likely fluctuate. Consequently, an investor's shares, when sold, may be worth more or less than their original cost. Additionally, American Capital's current performance may be lower or higher than the performance data quoted above.
This press release contains forward-looking statements. The statements regarding expected results of American Capital 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, national or international economic conditions or changes in the conditions of the industries in which American Capital has made investments.
Jeff MacDowell, Managing Director, Buyouts - (214) 273-6630
Kacy Ellis, Vice President, American Capital Energy - (214) 273-6630
Media - (301) 968-9400
SOURCE: American Capital Ltd.