In March 2007, ParaCap Group, LLC was approved as a registered broker/dealer.
Buy-side or Sell-side M&A
We can identify, evaluate and negotiate with appropriate buyers or sellers.
- Process may include a complete auction or targeted approach
- We can serve as an outsourced corporate development and strategic planning partner that compliments management
We have developed and employed a unique structure for two stage transactions.
- Seller can achieve near-term partial liquidity, participate in ongoing earnings and continue to build value for a subsequent liquidity event
- Buyer has the opportunity to limit downside by receiving a preference on a percentage of historical earnings and having more time to understand the business before completing the full purchase
- We can help companies determine the appropriate type of capital to issue
- We have a deep understanding of the capital markets and the nuances of issuing senior debt, subordinated debt, convertible debt / equity, preferred equity and common equity
- We can help identify and select the appropriate distribution platform for security being issued.
- In the case of public offering, we can act as a liaison between an issuer and the investment bankers to ensure efficient execution
- In the case of a private offering, we can arrange private equity or debt financing with accredited investor
We can issue fairness opinions to Boards of Directors or other bodies with fiduciary responsibilities tp shareholders in connection with an M&A transaction
- Fairness opinion can be stand-alone or in conjunction with a larger assignment
We can offer objective third–party business valuation services
- Appropriate for recurring (eg. ESOP valuation) or non-recurring(eg. partner buyout) assignments
- Able to avoid conflict of interest since our compensation would not be tied to a completed transaction
ParaCap partners have a diverse background in a variety of industries. We will consider advisory engagements and investments in any industry; however, we have historically focused on the following areas:
Core Focus Industries
- Insurance
- Waste and Environmental
- Homebuilding
- Industrial Manufacturing
- Business and Consumer Services
- Financial Services
Additional industries where we have made investments or performed advisory services
- Aerospace and Defense
- Consumer Products
- Banks and Thrifts
- Homeland Security
- Industrial Distribution
- Metals
- Specialty and Commodity Chemicals
- Telecom Equipment
Insurance
Financial advisor to US Specialty Underwriters, Inc. ("USSU") regarding its sale to Meadowbrook Insurance Group, Inc. (NYSE: MIG)
- Buyer acquired 100% of USSU's assets but seller retained 50% of its earning potential through a management contract
- Buyer received the 1st 50% of historical EBITDA
- Seller received the 2nd 50% of historical EBITDA
- Buyer and seller shared EBITDA in excess of historical amount
- Mechanism in place for buyer to repurchase management contract based on multiple of future earnings
- Transaction completed April 2007
Financial advisors to Meadowbrook Insurance Group, Inc (NYSE: MIG) regarding its follow-on equity offering in July 2007.
- Advised on size, timing, structure and investment banker selection
- MIG sold 5.5 million shares raising $53.1 million of primary capital.
- Chairman sold 750,000 shares generating an additional $7.2 million of secondary proceeds
- Transaction closed July 2007
Financial Advisor to Expert Comp, Inc. regarding the completion of the two-staged sale of US Specialty Underwriters, Inc. to Meadowbrook Insurance Group, Inc. (NYSE:MIG)
- Buyout of the management contract for 50% of USSU's earning potential
- Transaction completed January 2008
Financial advisor to Meadowbrook Insurance Group, Inc. (NYSE:MIG) regarding its acquisition of ProCentury Corp. (Nasdaq GS: PROS)
- Approached MIG with the idea and negotiated transaction on its behalf
- Total consideration to PROS shareholders of $272.6 million
- Consideration consisting of 55% MIG common stock and 45% cash
- Transaction closed July 2008
Financial advisor to the management of ESP Management Services Agency, Inc. regarding its purchase of Employers Select Plan Agency from National Financial Partners (NYSE:NFP)
Financial advisor to the management of ESP Management Services Agency, Inc. regarding its sale of Employers Select Plan Agency to MMO Agency Management, LLC
- Both transactions closed in March 2008
Waste
Financial advisor to Liberty Waste and Sun County Materials regarding sale to Waste Services, Inc. (Nasdaq GM: WSII)
- Structured as two stage transaction totaling $40 million in cash and stock
- Sale of hauling operation and two transfer stations closed in May 2006
- Sale of construction and demolition landfill closed in July 2006
Financial advisory to Live Earth LLC regarding its acquisition of Sunny Farms Landfill (Fostoria, OH) and Champion City Recovery (Brockton, MA) from Regus Industries, LLC
- Transaction valued at $52 million including cash, assumption of debt and other consideration
- Transaction closed January 2008
Real Estate – Land Development
Financial advisor to Miller Holdings regarding purchase of $50 million parcel of land in Phoenix, AZ
- Worked with MMA Realty Capital of Tampa, FL to arrange financing
- Transaction closed June 2006
