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American Capital Achieves a Gain of $11 Million and Receives $72 Million in Proceeds from triVIN Exit
Feb 02, 2011 (04:02 PM EST)
BETHESDA, Md., Feb. 2, 2011 /PRNewswire/ -- American Capital Ltd. (Nasdaq: ACAS) announced today that on January 31 its portfolio company triVIN Holdings, Inc. ("triVIN") was acquired by DealerTrack Holdings, Inc. (Nasdaq: TRAK) ("DealerTrack"). American Capital received $72 million in proceeds and realized a gain of $11 million during the first quarter from the transaction, subject to post-closing adjustments.
Including investments in triVIN by American Capital's affiliated funds under management, the total proceeds received during the first quarter from the transaction were $108 million, realizing a gain of $19 million, subject to post-closing adjustments. Including accrued dividends, American Capital and its affiliated funds under management received total equity proceeds of $87 million, which exceeded their aggregate original equity investment by $33 million.
triVIN provides electronic vehicle registration and title management services to automobile lenders and dealers nationwide. triVIN provides its services through two wholly-owned subsidiaries, FDI Collateral Management and General Systems Solutions. The company is headquartered in Groton, Connecticut and has a major facility in Sacramento, California.
American Capital and its affiliates invested $96 million in the One Stop Buyout™ of triVIN in June 2007 and committed $10 million to a revolving credit facility. American Capital's investment took the form of a revolving credit facility, senior term loan, senior and junior subordinated debt and convertible preferred and common equity. Shortly after closing, American Capital syndicated the senior term loan provided to triVIN. For more information about American Capital's investment in triVIN, please go to http://www.americancapital.com/our_portfolio/companies/trivin.html.
American Capital's compounded annual rate of return earned over the life of its total investment was 18%, including interest, dividends and fees earned over the life of its investment. The proceeds received by American Capital were greater than the third quarter 2010 valuation of American Capital's debt and equity investments by $15 million, or 26%, and the equity proceeds received by American Capital were greater than the third quarter 2010 valuation of its equity investments by $15 million, or 41%.
"Since our initial investment in triVIN over three years ago, the company has significantly outperformed its end markets and continued to grow through the economic downturn," said Brian Graff, Senior Managing Director. "We are very pleased with the outcome of this transaction."
"Our investment in triVIN yielded an attractive return for American Capital's shareholders," said Sean Eagle, Principal, Buyouts. "TriVIN's strong financial performance despite substantial declines in its end markets is a testament to the strength of its business platform and management team. It was a pleasure working with triVIN CEO Mark Furcolo and the rest of the triVIN team."
"We enjoyed the opportunity to partner with triVIN management and drive value for triVIN's stakeholders," said Sean Reid, Vice President, Buyouts. "We wish DealerTrack and the triVIN management team success in the future."
Since American Capital's August 1997 IPO through the third quarter of 2010, the company has earned a 12% compounded annual return, including interest, dividends, fees and net gains, on 306 realizations of senior debt, subordinated debt, equity and structured products investments, totaling $15 billion of committed capital. These realizations represent 60% 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 26% 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 $18 billion in capital resources under management and eight offices in the U.S., Europe and Asia. American Capital and its affiliates will consider investment opportunities from $5 million to $100 million. For further information, please refer to www.AmericanCapital.com.
ABOUT DEALERTRACK HOLDINGS, INC.
DealerTrack (Nasdaq: TRAK) is a provider of on-demand software solutions to the automotive retail industry in the United States and Canada. DealerTrack provides software solutions to both auto lenders and auto retailers, including the auto industry's largest online credit application network linking auto lenders and dealers.
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.
SOURCE American Capital Ltd.