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| Stories of Genesis Park |
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Alpheus Communications
Deal Type: Carve out from public corporation
Exit: sold to financial buyer
In 2004 Genesis Park partnered with
the El Paso Corporation to carve out a troubled telecommunications
subsidiary. Genesis Park Partner Paul Hobby assumed the CEO role,
rebranding El Paso Global Networks as Alpheus and transitioning into
a fully independent entity. Alpheus has become the largest
alternative fiber optic network in Texas through prudent use of
leverage and disciplined re-investment of internally generated cash.
Organically and through targeted M&A, Alpheus has grown steadily
through all types of economic conditions: purchase of a data center
in Austin, acquisition of a data center operator in Dallas, and five
major fiber optic cable transactions.
Point One Communications
Deal Type: recapitalization
Exit: sale to financial buyer
In 2001, we participated in the
rescue of PointOne from bankruptcy, providing senior debt and
receiving equity warrants We understood the business and the market
(IP transit globally) and liked our priority and our positioning
were the company to get in trouble again. We received our principal
back within a year and participated in the sale to Thermo Capital,
recognizing significant gain on the equity and receiving mezzanine
interest rates on a seller note.
Red Arrow Energy
Deal Type: start up
Exit: sale to strategic buyer
Genesis Park had a relationship for
many years with two talented E&P entrepreneurs who in 2006 wanted to
raise a drilling fund. We encouraged them to consider a corporate
structure, a strategy they ultimately chose. Red Arrow Energy was
born with three high net worth family offices as its initial
investors, including a Genesis Park affiliate. Encap Partners
assumed a control position as a second round investor. Red Arrow
made strategic acquisitions in the Bakken Shale in North Dakota and
entered into several different development alliances in the Bakken,
eventually selling the majority of its position to Hess for $1.4
Billion in December of 2010.
CapRock Communications
Deal Type: carve out from public corporation
Exit: sale to financial buyer
After deciding to focus on the
wireless industry in 2000, Genesis Park Partner, Peter Shaper,
undertook a search for the right opportunity and in early 2002 was
able to buy a satellite provider at an attractive price from the
estate of McLeod Communications -- after the parent filed for
bankruptcy. Mr. Shaper stepped in as CEO and through a series of
acquisitions and organic opportunities CapRock became the largest
provider of VSAT services in the world. As the originator of the
transaction Genesis Park took an equity based warrant in addition to
its cash investment.
FuelQuest
Deal Type: growth financing
Exit: sale to strategic buyer
In 2003, after observing the
progress of a start up venture for a couple of years, we became
investors in FuelQuest as it entered its growth phase. FuelQuest’s
software solutions provide efficiency in bulk fuel management, and
collateral products. The company was able to grow steadily during
our investment period, acquiring large retail, transportation and
public sector customers before its sale to a strategic buyer in
2008.
Commercial American
Insurance Company
Deal Type: carve out from public corporation
Exit: sale to strategic buyer
In 2003 we were asked to
participate in a buyout of a small mono-line P&C insurer from ING
Barings. The buyer group insisted that this be done outside our
Private Equity fund structure due to uncertainty in the holding
period. We accepted a board position as part of our investment.
Through a process of tightening and automating the business
processes we were able to let the business scale revenue without
scaling overhead. CAIC experimented with new products on our watch,
some of which were successful and others not. We withdrew from the
unsuccessful diversification efforts and sold the business in late
2010 to a private insurance holding company.
Genesis Park Development
(a/k/a Western General Holdings)
Deal Type: stranded real estate asset
Exit: series of sales to strategic buyers
In 2000, we identified a Texas
chartered insurance company that had wound up most of its insurance
book but retained a valuable piece of urban real estate. The seller
had special sensitivities that could not be satisfied by the larger
concerns who had tried without success to acquire the property. We
were successful and also acquired an adjacent parcel to create a
uniquely developable tract. By a careful master planning exercise,
we retained certain development rights and worked with the local
neighborhood authority to add complimentary infrastructure. After
selling the first tract to a national developer to return all risk
capital, the second and third tracts were sold later for record
prices for the neighborhood. The added public amenities won a
prestigious award for quality in urban design.
Avalon Advisors
Deal Type: start up financial services
Exit: partial sale to financial buyer
In 2001, we were approached by
local high net-worth account managers from a large international
brokerage house and asked if we would assist and support their
formation of a local boutique investment advisory firm. We helped
structure a debt and equity offering -- raising capital from
selected individuals who could add value and reputation to the
launch. A requirement was that only approved individuals could
invest rather than private equity funds. Helping to recruit
investment talent and clients, we aided the steady growth of Avalon
through several investment cycles, in 2008 the firm sold
approximately one third of its equity to a private equity firm, and
retained some equity going forward. Over a period of years Avalon
sold equity interests to two private equity firms: Platform Partners
and the Carlyle Group.
SAT Corporation
Deal Type: growth
Exit: sale to strategic buyer
In 2001, Genesis Park identified a
growth investment opportunity in a small energy software company
with a product that provided automated wireless data input for ERP
systems popularly used in large industrial facilities common to the
Houston region (refineries, chemical plants etc...) We were the only
professional investor in the capital structure and assisted with
board oversight, talent recruitment and client presentations. In
exchange for that added value, we took an equity warrant to
compensate for differentiated effort among shareholders. SAT was
sold to Invensys in 2008. Post-closing Genesis Park served
successfully as the shareholder representative for complicated
post-closing intellectual property litigation management.
Intermat
Deal Type: carve out
from public parent
Exit: sale to strategic buyer
In 2004, we
joined with the founder of this niche catalogue software provider to
buy the company back from MAXIMO, who had made a strategic decision
to focus elsewhere in the ERP value chain. The price was attractive
and our structural protection within the buyer group was excellent.
One of Genesis Park’s principals was seconded to serve as Intermat’s
CEO. After a less than two year holding period the company was sold
to IHS holdings.
Vivante
Deal Type: recapitalization
Exit: sale to strategic buyer
In 2009, we partnered with management to
acquire the majority of the Introgen assets out of bankruptcy.
Introgen had built out the clean room facilities and developed
manufacturing expertise for its internal use, that we rebranded and
re-launched as a third party manufacturer of viral vectors for
customers who needed scaled quantities of their to biopharmaceutical
portfolio assets. Vivante GMP Solutions was the result of that
strategy. Vivante was acquired in 2010 by Swiss-based LONZA, one of
the world's leading suppliers to the pharmaceutical, healthcare and
life science industries.
Overton
Deal Type: successor to Red Arrow
Exit: TBD
Overton Energy is a start up company focused
on finding and executing on upstream oil and gas strategies sourced
through data and relationships. In frothy energy markets, retail
producing properties or “proven acreage deals” packaged and marketed
by brokers are unlikely to generate acceptable returns. Overton
sources deals through experienced working relationships in the North
American E & P community. Good faith, prudent hedging and solid
underwriting is the way Overton sources capital also. Genesis Park
has a profitable history with Overton management, and is pleased to
be included in the initial funding group.
Coda
Deal Type: Pre-public
Exit: TBD
CODA Automotive is a new kind of car company
building all electric vehicles. For so many reasons the time has
come for EV, and CODA brings a stable of battery technologies and
talented automotive executives to make that opportunity into
reality. Energy today means finding the most effective solutions.
BTU's, electrons and isotopes all have their place in the
transportation fuels merit order. Headquartered in Los Angeles with
battery and manufacturing partnerships in Tianjin and Harbin China
respectively, CODA is a global company meeting a global demand.
Genesis Park is represented on the CODA advisory board.
Vartopia
Deal Type: Growth
Exit: TBD
Vartopia solves the “commercial spaghetti
code” phenomenon that exists between OEM’s and their VAR’s as deals
originate, evolve and eventually close. The company is led by a very
experienced leadership team who has consistently succeeded in using
software as a problem solver for large corporate customers at their
friction points. Genesis Park sourced this opportunity through a
successful previous investment relationship.
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