HM Capital Partners was a
private equity
In the field of finance, the term private equity (PE) refers to investment funds, usually limited partnerships (LP), which buy and restructure financially weak companies that produce goods and provide services. A private-equity fund is both a t ...
firm in the United States that specialized in
leveraged buyout
A leveraged buyout (LBO) is one company's acquisition of another company using a significant amount of borrowed money ( leverage) to meet the cost of acquisition. The assets of the company being acquired are often used as collateral for the loa ...
s. The firm was previously known as Hicks, Muse, Tate & Furst. It was founded in 1989 by
Tom Hicks
Thomas Ollis Hicks Sr. (born February 7, 1946), is an American private equity investor and sports team owner living in Dallas, Texas. ''Forbes'' magazine estimated Hicks' wealth at $1 billion in 2009, but it dropped to $700 million in 2010 ...
and
John Muse
John Roger Muse (born August 1, 1988) is an American ice hockey goaltender who is currently with Glasgow Clan in the UK Elite Ice Hockey League (EIHL). Muse was most recently with Rødovre Mighty Bulls in the Danish Metal Ligaen. He also previou ...
as Hicks, Muse & Co. and was changed in 1994 to reflect the roles of Charles Tate and Jack Furst.
History
Hicks & Haas
The son of a
Texas
Texas (, ; Spanish: ''Texas'', ''Tejas'') is a state in the South Central region of the United States. At 268,596 square miles (695,662 km2), and with more than 29.1 million residents in 2020, it is the second-largest U.S. state by ...
radio station
Radio broadcasting is transmission of audio (sound), sometimes with related metadata, by radio waves to radio receivers belonging to a public audience. In terrestrial radio broadcasting the radio waves are broadcast by a land-based radi ...
owner,
Tom Hicks
Thomas Ollis Hicks Sr. (born February 7, 1946), is an American private equity investor and sports team owner living in Dallas, Texas. ''Forbes'' magazine estimated Hicks' wealth at $1 billion in 2009, but it dropped to $700 million in 2010 ...
became interested in
leveraged buyout
A leveraged buyout (LBO) is one company's acquisition of another company using a significant amount of borrowed money ( leverage) to meet the cost of acquisition. The assets of the company being acquired are often used as collateral for the loa ...
s as a member of
First National Bank's
venture capital
Venture capital (often abbreviated as VC) is a form of private equity financing that is provided by venture capital firms or funds to start-up company, startups, early-stage, and emerging companies that have been deemed to have high growth poten ...
group.
Hicks and
Robert Haas formed ''Hicks & Haas'' in 1984; the next year that firm bought ''Hicks Communications'', a radio outfit run by Hicks' brother
Steven
Stephen or Steven is a common English first name. It is particularly significant to Christians, as it belonged to Saint Stephen ( grc-gre, Στέφανος ), an early disciple and deacon who, according to the Book of Acts, was stoned to death; ...
. (This would be the first of several media companies bought or created by the buyout firm that involved Steven Hicks.)
Hicks & Haas' biggest coup was its mid-1980s acquisition of several
soft drink makers, including
Dr Pepper
Dr Pepper is a carbonated soft drink. It was created in the 1880s by pharmacist Charles Alderton in Waco, Texas, and first served around 1885. Dr Pepper was first nationally marketed in the United States in 1904. It is now also sold in Euro ...
and
7 Up
7 Up (stylized as 7up outside North America) is an American brand of lemon-lime-flavored non-caffeinated soft drink. The brand and formula are owned by Keurig Dr Pepper although the beverage is internationally distributed by PepsiCo. 7 Up co ...
. The firm took Dr Pepper/7 Up public just 18 months after merging the two companies. In all, Hicks & Haas turned an $88 million investment funding into $1.3 billion. The pair split up in 1989; Hicks wanted to raise a large pool to invest, but Haas preferred to work deal by deal. Robert Haas went on to form
Haas Wheat & Partners a middle market
private equity firm
A private equity firm is an investment management company that provides financial backing and makes investments in the private equity of startup or operating companies through a variety of loosely affiliated investment strategies including lev ...
based in Dallas.
Hicks, Muse, Tate & Furst (HMTF)
Hicks raised $250 million in 1989 and teamed with former
Prudential Securities banker John Muse to form Hicks Muse. Early investments included Life Partners Group (
life insurance, 1990; sold 1996). In 1991
Morgan Stanley
Morgan Stanley is an American multinational investment management and financial services company headquartered at 1585 Broadway in Midtown Manhattan, New York City. With offices in more than 41 countries and more than 75,000 employees, the fir ...
's Charles Tate and
First Boston : ''For the company after its acquisition by Credit Suisse, see Credit Suisse First Boston (known as CSFB and CS First Boston)''
The First Boston Corporation was a New York-based bulge bracket investment bank, founded in 1932 and acquired by Cred ...
's Jack Furst became partners.
As part of its buy-and-build strategy, Hicks Muse bought
DuPont's connector systems unit in 1993, renamed it Berg Electronics, added six more companies to it, and doubled its earnings before selling it in 1998. Not every acquisition was successful for Hicks Muse. Less-than-successful purchases included bankrupt brewer
G. Heileman Brewing Company of
La Crosse, Wisconsin, bought in 1994 and sold two years later for an almost $100 million loss.
The buyout firm's Chancellor Media radio company went public in 1996. That year Hicks Muse gained entry into
Latin America
Latin America or
* french: Amérique Latine, link=no
* ht, Amerik Latin, link=no
* pt, América Latina, link=no, name=a, sometimes referred to as LatAm is a large cultural region in the Americas where Romance languages — languages derived f ...
with its purchases of cash-starved Mexican companies, including Seguros Commercial America, one of the country's largest insurers. That year also brought International Home Foods (Jiffy Pop,
Chef Boyardee
Chef Boyardee is an American brand of canned pasta products sold internationally by Conagra Brands. The company was founded by Italian immigrant Ettore Boiardi in Milton, Pennsylvania, U.S., in 1928.
History
After leaving his position as head ...
) into the Hicks Muse fold.
In 1997 Chancellor and Evergreen Media merged to form Chancellor Media (renamed AMFM in 1999). The next year Hicks Muse continued buying US and Latin American media companies, as well as a few oddities (a
UK software maker, a Danish seed company, and US direct-seller
Home Interiors and Gifts
Home Interiors and Gifts was a direct sales company specializing in decorating accessories, which were sold by more than 140,000 representatives through home parties in the United States, Canada, Mexico, and Puerto Rico. Highland Capital Managem ...
). Hicks Muse and
Kohlberg Kravis Roberts
KKR & Co. Inc., also known as Kohlberg Kravis Roberts & Co., is an American global investment company that manages multiple alternative asset classes, including private equity, energy, infrastructure, real estate, credit, and, through its strate ...
merged their
cinema
Cinema may refer to:
Film
* Cinematography, the art of motion-picture photography
* Film or movie, a series of still images that create the illusion of a moving image
** Film industry, the technological and commercial institutions of filmmaking
...
operations to form the US's largest
theater
Theatre or theater is a collaborative form of performing art that uses live performers, usually actors or actresses, to present the experience of a real or imagined event before a live audience in a specific place, often a stage. The perform ...
chain,
Regal Cinemas
Regal Cinemas (also Regal Entertainment Group) is an American movie theater chain headquartered in Knoxville, Tennessee. A division of Cineworld, Regal operates the second-largest theater circuit in the United States, with over 7,200 screens i ...
. Regal would file for bankruptcy protection in 2001. The company that year also moved into the depressed energy field (Triton Energy) and formed a $1.5 billion
Europe
Europe is a large peninsula conventionally considered a continent in its own right because of its great physical size and the weight of its history and traditions. Europe is also considered a subcontinent of Eurasia and it is located entirel ...
an fund.
Acquisitions in 1999 included UK food group Hillsdown Holdings, one-third of Mexican
flour maker Grupo Minsa, and (just in time for millennial celebrations) popular
champagne
Champagne (, ) is a sparkling wine originated and produced in the Champagne wine region of France under the rules of the appellation, that demand specific vineyard practices, sourcing of grapes exclusively from designated places within it, ...
brands
Mumm and Perrier-Jouët (it quadrupled its investment when it sold the champagne houses in late 2000). Lured by low stock prices on
real estate investment trust
A real estate investment trust (REIT) is a company that owns, and in most cases operates, income-producing real estate. REITs own many types of commercial real estate, including office and apartment buildings, warehouses, hospitals, shopping cente ...
s (REITs), the company agreed to buy Walden (formerly Walden Residential Properties) that year.
Hicks Muse, along with UK-based
Apax Partners
Apax Partners LLP is a British private equity firm, headquartered in London, England. The company also operates out of six other offices in New York, Hong Kong, Mumbai, Tel Aviv, Munich and Shanghai. As of December 2017, the firm, including its ...
, bought
British Telecom's yellow page directory business
Yell Group
Hibu Inc. (styled hibü), formerly Yellowbook Inc., is a provider of digital marketing and advertising solutions to small- and medium-sized businesses across the US. Hibu’s specialties includes web development and hosting, digital listings and ...
for roughly $3.5 billion, making it the largest non-corporate
LBO in European history.
Yell subsequently acquired US directories publisher McLeodUSA for about $600 million, and floated in 2003.
Hicks Muse acquired
Nestlé
Nestlé S.A. (; ; ) is a Swiss multinational food and drink processing conglomerate corporation headquartered in Vevey, Vaud, Switzerland. It is the largest publicly held food company in the world, measured by revenue and other metrics, since ...
's Ambient Food Business in 2002, which added well-known UK brands
Crosse & Blackwell
Crosse & Blackwell is a British food brand. The original company was established in London in 1706, then was acquired by Edmund Crosse and Thomas Blackwell in 1830. It became independent until it was acquired by Swiss conglomerate Nestlé in 1960. ...
,
Branston Pickle
Branston is an English food brand best known for the original Branston Pickle, a jarred pickled chutney first made in 1922 in the village of Branston near Burton upon Trent, Staffordshire by Crosse & Blackwell. The Branston factory proved to ...
,
Chivers (
marmalade
Marmalade is a fruit preserve made from the juice and peel of citrus fruits boiled with sugar and water. The well-known version is made from bitter orange. It is also made from lemons, limes, grapefruits, mandarins, sweet oranges, bergamot ...
),
Sun-Pat (
peanut butter),
Gale's
Gale's is a UK brand of honey, currently owned by Premier Foods. The former company had been established in 1919, remaining independent until it was acquired by Rowntree Mackintosh Confectionery in 1986.
History
The company was established in ...
(
honey
Honey is a sweet and viscous substance made by several bees, the best-known of which are honey bees. Honey is made and stored to nourish bee colonies. Bees produce honey by gathering and then refining the sugary secretions of plants (primar ...
),
Sarson's
Sarson's is a brand of malt vinegar brewed in the United Kingdom. It is sold in pear shaped bottles with a flip top and the brand is currently owned by Mizkan. Sarson's also produces vinegar for Sainsbury's, 3663, Chef, Independent and Mizkan.
...
(
vinegar
Vinegar is an aqueous solution of acetic acid and trace compounds that may include flavorings. Vinegar typically contains 5–8% acetic acid by volume. Usually, the acetic acid is produced by a double fermentation, converting simple sugars to eth ...
) and
Rowntree's
Rowntree's is a British confectionery brand and former business based in York, England. Rowntree developed the Kit Kat (introduced in 1935), Aero (introduced in 1935), Fruit Pastilles (introduced in 1881), Smarties (introduced in 1937) brands ...
(
jelly) to the
Premier Foods
Premier Foods plc is a British food manufacturer headquartered in St Albans, Hertfordshire. The group owns many well-known brands, including Mr Kipling, Ambrosia, Bird's Custard, Angel Delight, Homepride cooking sauces, Lyons, Sharwood's, Loy ...
stable.
Cereal maker
Weetabix Limited
Weetabix Ltd., trading under the name Weetabix Food Company and commonly referred to as simply Weetabix, is a food processing company that is responsible for the production of breakfast cereal brands, including Weetabix, Alpen, Crunchy Bran a ...
and
Unilever
Unilever plc is a British multinational consumer goods company with headquarters in London, England. Unilever products include food, condiments, bottled water, baby food, soft drink, ice cream, instant coffee, cleaning agents, energy dri ...
's cast-offs
Ambrosia (creamed rice and puddings) and Brown & Polson, rounded out Premier Foods' portfolio in 2003.
Acquisitions in 2004 included Kerns Oil & Gas (renamed Blackbrush Energy --
natural gas
Natural gas (also called fossil gas or simply gas) is a naturally occurring mixture of gaseous hydrocarbons consisting primarily of methane in addition to various smaller amounts of other higher alkanes. Low levels of trace gases like carbo ...
production),
Persona
A persona (plural personae or personas), depending on the context, is the public image of one's personality, the social role that one adopts, or simply a fictional character. The word derives from Latin, where it originally referred to a theatr ...
(Canadian
cable television
Cable television is a system of delivering television programming to consumers via radio frequency (RF) signals transmitted through coaxial cables, or in more recent systems, light pulses through fibre-optic cables. This contrasts with bro ...
company), Regency Gas Services (gas processing and distribution), and Centennial Puerto Rico Cable TV (Puerto Rican cable television company). It also agreed to buy a majority stake in trendy luxury
shoe
A shoe is an item of footwear intended to protect and comfort the human foot. They are often worn with a sock. Shoes are also used as an item of decoration and fashion. The design of shoes has varied enormously through time and from culture ...
maker
. Disposals during the year included the company's remaining stake in
Yell and its stake in Premier Foods.
In May 2005,
Sturm Foods
Sturm (German for storm) may refer to:
People
* Sturm (surname), surname (includes a list)
* Saint Sturm (died 779), 8th-century monk
Food
* Federweisser, known as ''Sturm'' in Austria, wine in the fermentation stage
* Sturm Foods, an American ...
was acquired by HM Capital Partners. Located in Manawa, Wisconsin, Sturm Foods specializes in manufacturing of bulk goods such as oatmeal and markets several sugar free products under private labels.
HM Capital and Successors
Hicks Muse struggled in the years immediately following the bursting of the
internet and telecom bubbles was often cited with
Forstmann Little
Forstmann, Little & Company was a private equity firm, specializing in leveraged buyouts (LBOs). At its peak in the late 1990s, Forstmann Little was among the largest private equity firms globally. Ultimately, the firm would suffer from the burs ...
as the highest profile
private equity
In the field of finance, the term private equity (PE) refers to investment funds, usually limited partnerships (LP), which buy and restructure financially weak companies that produce goods and provide services. A private-equity fund is both a t ...
casualties, having invested heavily in technology and
telecommunications
Telecommunication is the transmission of information by various types of technologies over wire, radio, optical, or other electromagnetic systems. It has its origin in the desire of humans for communication over a distance greater than that fe ...
companies. The firm's reputation and market position were both damaged by the loss of over $1 billion from minority investments in six telecommunications and 13 Internet companies at the peak of the 1990s stock market bubble as well as several traditional buyouts that ended in bankruptcy (e.g.,
Regal Cinemas
Regal Cinemas (also Regal Entertainment Group) is an American movie theater chain headquartered in Knoxville, Tennessee. A division of Cineworld, Regal operates the second-largest theater circuit in the United States, with over 7,200 screens i ...
, Viasystems Group, International Wire.
Tom Hicks
Thomas Ollis Hicks Sr. (born February 7, 1946), is an American private equity investor and sports team owner living in Dallas, Texas. ''Forbes'' magazine estimated Hicks' wealth at $1 billion in 2009, but it dropped to $700 million in 2010 ...
resigned from Hicks Muse at the end of 2004 and was replaced at the helm by co-founder John Muse. Hicks would go on to found Hicks Holdings LLC. Charles Tate resigned from Hicks Muse in 2002.
In January 2005, the company's European arm, separated from Hicks Muse to form
Lion Capital LLP
Lion Capital LLP is a British private equity firm specialising in investments in the consumer sector. Previous and current consumer brands owned by Lion have included Weetabix, Jimmy Choo, Wagamama, Kettle Foods and AllSaints.
The firm is headq ...
, which has since raised over $4 billion across two
private equity funds.
In March 2006, Hicks Muse Tate & Furst changed its name to HM Capital reflecting the departure of
Tom Hicks
Thomas Ollis Hicks Sr. (born February 7, 1946), is an American private equity investor and sports team owner living in Dallas, Texas. ''Forbes'' magazine estimated Hicks' wealth at $1 billion in 2009, but it dropped to $700 million in 2010 ...
and the new group of partners heading the firm. HM Capital appears to be overcoming initial obstacles, raising new capital from
institutional investors
An institutional investor is an entity which pools money to purchase securities, real property, and other investment assets or originate loans. Institutional investors include commercial banks, central banks, credit unions, government-linke ...
for a $1 billion
private equity fund, its first in more than five years.
In 2013, HM Capital began dissolving. The energy group spun out as Tailwater Capital and the food group spun off as Kainos Capital.
References
External links
*
Hicks Holdings Official Website
{{DEFAULTSORT:Hm Capital Partners
Financial services companies established in 1984
Financial services companies disestablished in 2013
Private equity firms of the United States
Companies based in Dallas
American companies established in 1984