Parthenon Capital announced that Restaurant Technologies, Inc. (“RTI”), one of its existing portfolio companies, has raised $60 million in a combined debt and equity financing round. Parthenon Capital led the equity financing, with participation from other existing and new investors, while Sankaty Advisors (“Sankaty”) of Boston, MA, and MCG Capital Corporation (“MCG”) of Arlington, VA led the investment in a new debt facility for the Company.
Sankaty and MCG co-invested in $50 million in Senior Secured Notes to refinance the Company’s existing debt facility and provide RTI with additional growth capital. The two also participated in the $10 million equity round with Parthenon Capital, ABS Capital Partners, and other existing investors. The proceeds will be used to fund the company’s continued aggressive expansion in new markets.
RTI is the leading provider of bulk cooking oil management services to the foodservice industry. Most foodservice operators currently receive cooking oil in containers which need to be manually delivered, stored, and unloaded into a fryer. The process for disposing of used waste oil is similarly manual and exposes the employee to burns and other injuries. In contrast, RTI’s patented system enables the foodservice employee to refill fryers, filter cooking oil, and dispose of waste oil with the flick of a switch. It provides foodservice owners and operators with reduced costs, enhanced safety, and improved information in their frying operations.
“Demand for our patented bulk oil management solution is increasing in both new and existing markets,” said Jeffrey R. Kiesel, RTI’s Chief Executive Officer. “This additional funding will allow us to broaden our geographic reach and better serve our customers. We are pleased to have Sankaty and MCG Capital as new investors and are appreciative of the continued support from Parthenon Capital and our existing investors. Also, we are grateful for their collective confidence in RTI’s growth potential.”
The Company achieved over $100 million in revenues in 2005 and has grown rapidly since Parthenon’s initial investment in 2001. It currently serves over 10,000 customers in 30 major metropolitan markets across the United States. Over this time, RTI has enhanced its ability to win new national foodservice accounts, has become a major supplier of waste oil to the bio-diesel and other industries, and has achieved operating synergies from increased customer density at existing depots.
Marshall Bartlett, a Principal at Parthenon Capital who has been involved with RTI since the firm’s initial investment, commented, “We are pleased to continue to support RTI’s expansion as the pioneer in the bulk oil management industry. The company is at the nexus of industries – business services, food, and value-added distribution – where we have spent considerable time and see continued attractive investment opportunities. We are excited to have Sankaty and MCG as new partners and look forward to continuing to work with Jeff Kiesel and his team in building the company.”
Restaurant Technologies, Inc., founded in 1997, is the leading provider of bulk cooking oil management services to the food service industry. RTI’s patented, closed-loop Bulk Oil Management Program frees restaurants from the expensive, cumbersome, and potentially hazardous tasks of storing, distributing, and disposing of cooking oil. After installing RTI’s system, restaurant employees can fill fryers, filter cooking oil, and dispose of waste oil with the flick of a switch, virtually eliminating the previous hazards and inconveniences of handling cooking oil. Today, RTI provides its Bulk Oil Management Program to over 10,000 restaurants, including more than 5,000 McDonald’s restaurants, through its 30 depots in major metropolitan markets. www.rti-inc.com
Parthenon Capital is a private equity firm with offices in Boston and San Francisco and over $1.1 billion of capital under management. With a staff of 47 people nationwide, Parthenon focuses on providing strategic resources and capital to middle-market companies for acquisition and internal growth strategies. Parthenon provides equity capital to companies with revenues between $50 million – $500 million. The firm invests in a wide variety of industries with a particular expertise in Business and Financial Services, Value-Added Distribution, Healthcare, Niche Manufacturing and Consumer Products. www.parthenoncapital.com
Sankaty Advisors, LLC is the credit affiliate of Bain Capital, LLC, is one of the nation’s leading private managers of high yield debt obligations. With approximately $12 billion in committed capital, Sankaty invests in a wide variety of securities, including leveraged loans, mezzanine debt, structured products and equity investments. Through a variety of funds, Sankaty Advisors has the ability to invest in a company’s capital structure at every level from secured debt to equity, and can also provide capital to growing companies with unique financing needs. www.sankatyadvisors.com
MCG Capital Corporation MCG provides capital to support the growth and value creation strategies of small- to mid-sized companies. As a publicly traded Business Development Company (NASDAQ ticker: MCGC), they offer highly customized financial solutions based on in-depth understanding of our borrowers’ business requirements. Since 1990, MCG has delivered value for financial sponsors and operators in more than 415 diversified financings representing cumulative investments in excess of $4.0 billion. www.mcgcapital.com