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Golden Gate Capital

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Golden Gate Capital
Company typePrivate
IndustryPrivate equity
Founded2000;24 years ago(2000)
FounderDavid Dominik,et al
HeadquartersOne Embarcadero Center, San Francisco, California,United States
ProductsLeveraged buyout,growth capital
AUM$15+ billion[1]
Number of employees
75[2]
Websitewww.goldengatecap

Golden Gate Capitalis an Americanprivate equity firmbased inSan Francisco.The firm makes investments in a number of select industries, including technology, financial services, retail and industrial, throughleveraged buyouttransactions, as well as significant minority purchases andgrowth capitalinvestments. As of April 2018,it had over $15 billion inassets under management.[1]

The firm was founded in 2000 by former investment professionals from private equity firmBain Capitaland its affiliate,Bain & Company,led by former Bain Capital partner David Dominik.[3]

Golden Gate's investment fund is structured as an evergreen fund with no finite life, meaning Golden Gate does not have to sell all investments within five to 10 years in order to raise another fund and can instead fund-raise as deals are made.[4]

As of 2017, the firm had approximately 54 investment professionals.[2]

Holdings

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Following the bursting of theDot-com bubble,the firm had shown a pattern of investments in technology companies that may have been distressed by theGreat Recession in the United Statesat that time.[citation needed]

In 2006, it bought Neways International for $500 Million, acquiring the company at an auction held by the divorce court. A prior $700 million transaction, led by Ramy El-Batrawi, had been abandoned, due to feuding between the divorcing couple that owned Neways International, each of whom were convicted, the previous year, on "six counts of income tax evasion and a conspiracy to defraud the IRS", and sentenced to more than two years in prison.[5]Ramy El-Batrawi died of unknown causes on April 23, 2024.[6]

On May 15, 2007,Limited Brandsannounced its intent to sell a 67% stake inExpressto Golden Gate Capital Partners. When the sale was finalized, in July 2007, Golden Gate's stake in the company was 75% for approximately $550 Million, instead of the announced 67%.[citation needed]

Through its unit, Mac Acquisition LLC, in 2008, the firm acquired a majority stake in theRomano's Macaroni Grillrestaurant chain for $131 Million. In October 2017, Mac Acquisition LLC filed forChapter 11bankruptcy protection, from which it was able to emerge in February 2018.[7]

In June 2009, the company announced the purchase of theJ.Jillbrand business fromTalbots.[8]In April 2011, theBahrain-based private equity firmArcapitabought Jill Acquisitions from Golden Gate.[9]

In 2011, it acquiredCalifornia Pizza Kitchen.[10]The company declared bankruptcy in July 2020, seeking to reduce its debt load and close locations, during the midst of the COVID-19 pandemic.[11]

On October 9, 2012,Wolverine World Wide,Golden Gate Capital andBlum Capitalacquired Collective Brands.[12]

On July 28, 2014, Golden Gate completed the purchase ofRed LobsterfromDarden Restaurants,for $2.1 billion.[13]The firm has been criticized for its handling of Red Lobster; Golden Gate was accused of "asset stripping"by selling off Red Lobster's real estate, which Golden Gate in turn kept as profit rather than a reinvestment into the restaurant chain.[14]Red Lobster filed forChapter 11 bankruptcyin May 2024.[15]

In November 2014, Golden Gate Capital agreed to buy Angus Chemical Co. and its Sterlington plant fromDow Chemical,for $1.215 billion.[16]

In May 2015, the company backed Philip P. Gass and Kostas Cheliotis with $750 million for a reinsurance company.[17]That month, Golden Gate Capital, with Arcapita Bank, also sold its J.Jill retail holdings toTowerBrook.[18][19]

In September 2016, the company acquired lifestyle clothing brandPacSun,after the retailer completed Chapter 11 bankruptcy.[20]

In January 2017, the company purchased theBob Evans Restaurantsdivision from Bob Evans Farms, for $565 million.[21]On August 8, 2017, Golden Gate Capital finalized the acquisition ofNeustar,Inc., previously NSR, a publicly traded company.[citation needed]

In June 2018, the company announced that it had established a new operating company, PSEB Group. PSEB is composed of two Golden Gate portfolio companies:Eddie BauerandPacific Sunwear of California.[22]In July, Golden Gate Capital announced that it had acquired The Learning Experience, one of the nation's largest and fastest-growing academies of early education andchild careproviders.[23]In November, Golden Gate Capital announced that it had acquired Vector Solutions ofTampafromProvidence Equity Partners,for an undisclosed sum.[24]

In September 2019, Golden Gate Capital acquired autism and childhood behavioral health services provider, Invo Holding, LLC, for an undisclosed amount.[25][26]In November, the firm sold Hillstone Environmental Partners, which it had co-founded in 2015 as ade novoinvestment, in a partnership with Hillstone CEO and co-founder Jay Parkinson. NGL Energy Partners acquired the CentralDelaware Basinwater pipeline and disposal infrastructure company for approximately US$600 million.[27]

References

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  1. ^abGolden Gate Capital
  2. ^ab"Archived copy".Archived fromthe originalon 2017-11-16.Retrieved2017-04-29.{{cite web}}:CS1 maint: archived copy as title (link)
  3. ^de la Merced, Michael J. (October 28, 2011)."Golden Gate Capital Closes $3.5 Billion Fund".The New York Times.RetrievedJune 1,2020.
  4. ^Dai, Shasha (16 October 2014)."5 Things to Know About Golden Gate Capital".Blogs.wsj.Retrieved8 January2018.
  5. ^Leong, Grace (November 9, 2006)."Neways sold to private equity firm".Daily Herald.
  6. ^"Ramy El-Batrawi Died in L.A."Hollywood LA News.2024-04-24.Retrieved2024-04-24.
  7. ^Klein, Danny (February 2018)."Romano's Macaroni Grill Emerges from Bankruptcy".FSRmagazine.RetrievedJune 1,2020.
  8. ^"Paying the Price for J. Jill".Multichannelmerchant.July 1, 2009.Retrieved2010-09-14.
  9. ^CIT Provides Financing for J. Jill Acquisition - BloombergArchived2012-03-30 at theWayback Machine.Origin- bloomberg. Retrieved on 2014-05-23.
  10. ^"Press Release: California Pizza Kitchen to Be Acquired by Golden Gate Capital; Stockholders to Receive $18.50 in Cash Per Share"(PDF).Info.cpk.Archived fromthe original(PDF)on 4 March 2016.Retrieved8 January2018.
  11. ^Maze, Jonathon."CALIFORNIA PIZZA KITCHEN DECLARES BANKRUPTCY".restaurantbusinessonline.Restaurant Business.Retrieved13 August2020.
  12. ^"Wolverine Worldwide, Golden Gate Capital and Blum Capital complete acquisition of Collective Brands".Golden Gate Capital.
  13. ^"Darden Completes Sale Of Red Lobster To Golden Gate Capital".MarketWatch.RetrievedAugust 26,2014.
  14. ^Morgenson, Gretchen (May 24, 2024)."How private equity rolled Red Lobster".NBC News.Archivedfrom the original on 2024-05-24.RetrievedMay 26,2024.
  15. ^"Red Lobster files for bankruptcy, but restaurants will stay open".NBC News.2024-05-20.Retrieved2024-07-18.
  16. ^Hilburn, Greg (November 12, 2014)."Dow sells ANGUS to private equity firm".The News-Star.
  17. ^Buhayar, Noah (13 May 2015)."Golden Gate Capital Backs Gass in $750 Million Reinsurance Push".Bloomberg.Retrieved10 September2015.
  18. ^Farrell, Maureen (April 8, 2016)."Clothing Retailer J. Jill Group Takes Steps for Possible IPO".The Wall Street Journal.RetrievedMay 30,2020.
  19. ^Masunaga, Samantha (March 31, 2015)."Women's retailer J.Jill bought by private equity firm".Los Angeles Times.RetrievedMay 30,2020.
  20. ^Tabuchi, Hiroko(7 April 2016),"Pacific Sunwear Files for Bankruptcy",The New York Times,retrieved14 May2021
  21. ^"Bob Evans to sell restaurants, focus on foods business".ABC News 4. 24 January 2017.
  22. ^"Golden Gate Capital Announces Eddie Bauer and Pacific Sunwear to Become Portfolio Companies of New Operating Company, PSEB Group".Businesswire.June 7, 2018.RetrievedJune 18,2020.
  23. ^"Golden Gate Capital Acquires The Learning Experience, a National Franchise and Academy of Early Education".businesswire.July 2, 2018.
  24. ^Huff, Pam (November 5, 2018)."San Francisco private equity firm acquires Tampa's Vector Solutions".Tampa Bay Business Journal.RetrievedMay 30,2020.
  25. ^FinSMEs (2019-09-26)."Golden Gate Capital Acquires Invo Holdings".FinSMEs.Retrieved2020-03-31.
  26. ^"Golden Gate Capital Acquires Invo Holdings".bloomberg.Retrieved2020-03-31.
  27. ^"Golden Gate Capital completes sale of water pipeline company Hillstone Environmental".Fluid Handling.Woodcote Media Limited. November 5, 2019.Archivedfrom the original on 2023-06-28.RetrievedMay 31,2020.
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