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Founded in 1955, Shemin initiated 'one-stop' horticultural distribution centers in the United States, providing fresh nursery stock to landscape contractors and not to the retail public. At the time of the leveraged recapitalization, Shemin had over $80 million of revenue.
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A sale to strategic buyers was considered; however, Shemin’s shareholders recognized continued growth opportunities and the leveraged recapitalization allowed existing shareholders a second bite at the apple through holding a 20% ongoing interest.
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The majority of the proceeds from the leveraged recapitalization were used to pay a significant dividend to both the private capital and management shareholders.
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The transaction was financed with equity and debt capital that were each approximately 50% of the capital structure. In addition to the financial investors and management retaining a 20% equity position, management was issued new performance-based warrants.