Growth Fueled International Consumer Product Company
Portfolio Company: Formation Brands
Industry: Consumer Products
Situation: In 2009, Formation Brands entered into a state receivership process due to a downturn in the retail sector, the loss of a major customer and over-leverage. Formation Brands faced possible liquidation. Recognizing the potential through operational improvements, FC Crestone and a partner entered into a transaction to acquire the assets of the business and to support a simultaneous add-on acquisition.
FC Crestone Value Add: FC Crestone worked closely with an operating partner and Formation Brands management to transform the business through:
- Retaining a new CEO to help drive the strategic operational and growth plans
- Materially improving Formation Brands’ margin structure which positioned the business to generate significant cash flow as revenue rebounded
- Strategically growing the business through completing two synergistic add-on acquisitions
Outcome: Formation Brands was sold to a strategic acquirer after six years of substantial growth.