Bastech sales have grown more than 350% since the 2007 acquisition by Cave Creek Capital and Courtney Group and its financing needs have grown larger and more complex.  President, Bob Closs, noted, “SunTrust will be an excellent partner going forward as we continue to expand and service our client’s growing needs, particularly as our sourcing and sales grow outside of the United States”.

Cave Creek Capital Contact:
Jourdin Lambright, Marketing Associate
Phone: (480) 478-6960
jlambright@cavecreekcapital.com

Integro earns a perfect 100 score when clients are asked if they’d recommend the firm to peers – eleven points higher than the 89 average for the ‘Big-Three’ (Marsh, Aon and Willis Group).

“Integro wins strong loyalty recognition from clients, especially lead clients, all of whom would recommend Integro to a peer in the industry,” said David Fox, Greenwich Associates managing director. “Integro is more than up to the challenge of the tough market. The firm is demonstrating strong results as it builds its presence as measured by total clients and clients citing Integro as their lead or most important broker.”

Peter Garvey, Integro President and CEO, said, “We created Integro to fill a gap in the broker marketplace – a firm capable of competing with the very biggest companies on offerings designed to deliver our services in a personalized, customized manner. It is gratifying to be recognized by clients and to know that my colleagues are providing results worthy of such recognition.”

According to Greenwich Associates’ research, pace-setting performance in several categories boosted Integro’s standing, including:

• Customer Satisfaction: Integro’s 100 score bests the ‘big-three’ average of 91 as lead broker;
• Broker’s Ability to Understand Client’s Business Needs: At 95, a stellar showing for Integro and well above the ‘big-three’ average 81;
• Broker’s Global Coordination and Management: Integro’s 100 dramatically outpaces the ‘big-three’ average client 70 rating;
• Ease of Working with Brokerage: Integro’s 95 soared above the ‘big-three’ average 82;
• Broker’s Ethical Standards: Integro’s 100 contrasts with the average ‘big-three’ 93 rating.

Integro also earns exceptionally high marks for Firm Transparency, Broker Innovation, Coordinating Claims Processing with Carriers, and Client Satisfaction with Visit Frequency, among others.

The Greenwich Associates survey, conducted in late 2011, covers insurance brokerage and carrier needs of U.S.-based companies with annual sales over $500 million. In-depth telephone interviews are conducted with senior professionals responsible for insurance and risk management. These professionals are asked to comment on the most important client service elements for each broker and carrier such as professional knowledge, execution, service, and underwriting. This analysis identifies the best corporate insurance carriers and brokers and highlights valuable information on the needs of risk management professionals.

Greenwich Associates is the premier strategic consulting and research source for providers and users of financial services worldwide.

About Integro
Integro is an insurance brokerage and risk management firm designed to serve organizations with complex risks. Repeatedly praised and awarded for dedicated client service, Integro’s industry-leading brokers operate from offices worldwide. Its headquarter office is located at 1 State Street Plaza, 9th Floor, New York, NY 10004. 1-877-688-8701. www.integrogroup.com

Editorial Contact:
Betsy Van Alstyne
Integro
Tel: 212-295-5445
betsy.vanalstyne@integrogroup.com

Date: Wednesday, May 18, 2011, 11:06am PDT – Last Modified: Wednesday, May 18, 2011, 1:12pm PDT

Integro, a New York-based insurance brokerage and risk management firm with an outpost in San Francisco, said Wednesday it has acquired San Francisco’s Argo Insurance Brokers.

To read full article, click here.

Vistage International was founded in 1957 and has always had the same objective: to help executives make better decisions, achieve better results, and enhance their lives.  Still operating under those same principals, Vistage has grown to over 14,000 members in 16 countries, becoming one of the world’s leading chief executive organizations.  For more information on Vistage, please visit www.vistage.com

Cave Creek Capital Management is a private equity firm headquartered in Scottsdale, AZ.  Cave Creek Capital partners with management teams through leveraged buyouts, growth capital and/or mezzanine investment structures.  They use their capital, experience and relationships to enhance a company’s growth and competitive position.  They seek market leaders in targeted sectors such as business services, specialty manufacturing, financial services, consumer, media, and energy.  They focus on businesses that are cash flow positive, preferably $2.0 million in EBITDA and above, and their average investment hold period is approximately five years.

Management buyout of vibration isolation and seismic control components manufacturer from corporate parent

• Overview:
  • VMC was a division of Aeroflex, Inc. with an established 100 year old industrial brand, providing vibration isolation and seismic control solutions to the industrial, military and construction markets
  • Performance declined after illness and death of President in 2002
  • Aeroflex determined that VMC no longer fit its core strategic focus and decided to sell the division in 2004
  • Select management and owners of VMC’s largest distributor proposed an acquisition of the Company
  • Aeroflex received other indications of interest from strategic buyers but favored management team bid, assuming financing risk can be minimized
  • Challenge was to obtain financing commitments for a highly leveraged capital structure with substantial pro forma cost savings assumed and a tight closing timetable.
• Transaction:
  • Transaction closed in March 2005
  • Compelling turnaround story and committed management team created substantial interest from lenders, resulting in several term sheets
  • Management retained a control position.  Hill Street Capital and PNC Business Credit provided the debt financing and Cave Creek Capital provided the “deep pockets” to fund future growth
• Results:
  • Revitalized management team and workforce produced immediate financial performance improvement
  • Excess overhead and costs under prior corporate owner trimmed as planned
  • Acquired competitor Amber Booth in 2007
  • Sales grew more than 200% and backlog reached record levels within three years
  • Management recapitalized the mezzanine debt and equity with Fifth-Third Bancorp in 2009 resulting in an 8x markup in Management’s original equity stake

Opportunity: Identifying customer trends and launching an industry consolidation

• During the early 1990’s, David Beale acquired a small group of Executive Office Suites in Washington DC, New York and Boston, then named Alliance Business Centers
• The industry was then highly fragmented and had a generally poor reputation for quality and service. Financial performance of Centers varied widely and what little capital was available to operators came from landlords and investors who classified the investments as “real estate”
• The industry had failed to keep pace with the increasing demands of more sophisticated customers who were outsourcing their real estate and administrative services. An increasingly mobile workforce for companies of all sizes raised the demand for improved communication and support services. More than half of Business Center clients were employees of mid- to large size companies.

Private Capital Solution:

• David Beale, and his team recognized and seized three opportunities to shift the Executive Office business model from a Real Estate-driven model to an Outsourced Business Process Model: (i) dramatically increase Center cash flow by upgrading Center-level Management and improving service offerings; (ii) acquire Centers at attractive multiples due to lack of investor understanding and little competition; (iii) Cluster Centers within metro areas to achieve sales synergies, improve occupancy and drive additional services revenues
• Alliance raised over $20 million of Equity Capital from a group of investors led by Cahill Warnock and Northwood Ventures (including Mr. Fechtmeyer) and over $40 million of Bank Financing to launch an aggressive acquisition program
• David Beale substantially augmented his management infrastructure through improved reporting and systems and selected hires from the acquired companies to import “best practices” from around the U.S.
• During 1997 through 1999, Alliance (later renamed HQ Vantas) acquired nearly 200 Centers and became the largest operator in the United States
• Sold to HQ Office Solutions for over $200 million, representing an 8X return on the original investment

Opportunity: Founders’ Retirement

• After building a successful janitorial services company over 15 years from startup to more than $20 million in revenues. Two of the three Sanitors founders plan to retire while the third wants to continue the Company’s expansion
• The competitive environment created a wide range of performance between companies; many had succumbed to lower margin, commodity pricing. By contrast, Sanitors had developed a reputation based on premium service in its markets, catering to the leading office property owners, reducing account turnover and creating substantial opportunity for additional services
• The industry was regionally fragmented. No company controlled more than 5% of the U.S janitorial market. Several attractive acquisitions were available where Sanitors could leverage its reputation and existing customer base
• Issue to resolve: how to fund both the liquidity needs of the two retiring founders as well as potential acquisitions.

Private Capital Solution:

• Summit Partners led an investment by a group (including Management and Mr. Fechtmeyer’s previous fund, TSG Co-investors) that provided $20 million of Equity Capital, augmented by a $30 million Bank Revolver. These were both to be drawn down as needed, thus minimizing dilution while maximizing “deep pockets”
• Built Human Resource and IT infrastructure to accommodate rapid growth through acquisition
• By combining Sanitor’s outstanding reputation for quality with a strong capital partner, it was positioned as a “preferred” acquiror in the industry
• During 1998 through 2002, Sanitors completed 13 acquisitions in janitorial and landscaping and established itself as one of the largest janitorial services companies in the U.S. with over $160 million in sales
• Sold to Cravey, Green & Whalen in 2003

Growth recapitalization in partnership with management for largest confection distributor to non-food retailers

• Overview:
  • Liberty pioneered the direct-to-store distribution of confections and snacks to non-food retailers in 1998
  • Founder desired liquidity to diversify net worth but wanted to remain with the Company after the transaction
  • Senior management team wanted equity ownership as part of Founder’s transition
  • Founder agreed to growth recap led by Cave Creek Capital in 2007; transaction completed in 2008
  • Cave Creek Capital saw substantial new growth opportunities driven by increasing retailer interest in launching/expanding confection category in checkout aisle
  • Compelling market dynamics and committed management team created substantial interest from lenders, resulting in several term sheets with attractive terms despite turbulent credit market conditions
• Post-transaction actions taken to create value:
  • Expanded borrowing capacity to facilitate future capital needs due to projected aggressive growth
  • Significant ownership/incentives which motivated employees
  • Brought sales force “in-house”
  • Hired additional senior executives
  • Created “forward-looking” reports and enhanced Management information/sales systems to monitor progress and pursue more prospective accounts
  • Assisted in execution and funding of acquisition of major competitor
• Results:
  • Management owned large minority position
  • Conservatively capitalized balance sheet to fund future growth
  • Expanded customer base – sales increased over 100% in two years
  • Expanded employee base by over 30%
  • Industry leadership position has been significantly enhanced
  • Recapitalized in 2010 allowing management to repurchase majority stake

Opportunity: Human Resources leverages Information Technology

• Founded as an executive recruiter, in the late 1980’s
• Developed the “Hire, Train, Retain” service model
• Purchased several companies in targeted areas; multiplied the sales post-acquisition by crossselling to Fortune 500 customer base
• Rapid growth attracted national attention, including membership in the INC 500 and E&Y Entrepreneur of the Year
• In 1998, Co-Founder, decided to retire and sell his shares
• Kenexa’s success in several business lines; online surveys, training and recruiting; required additional investment in product development and marketing
• A Private Capital partner was chosen (in lieu of an IPO) to assist in the funding of Kenexa’s needs in a multi-level recapitalization

Private Capital Solution:

• $27 million of Equity Capital from institutional investors
• Repurchased $8 million of stock from the retiring Founder and funded expansion of new product offerings
• Refinanced a stringent asset-based bank loan
• Board of Directors expanded, existing management retained control
• Additional financing in late 2000 added a critical “cushion” of capital when the economy went into a downturn.
• Business model shifted successfully to recurring contracts, supporting outsourced hiring and retention programs
• Completion of IPO on June 29, 2005 at $12/share, rose to a high of $39/share in 2007

Insurance brokerage and risk management firm start-up

• Overview:
  • Regulatory turmoil created opportunity for “fresh start” insurance brokerage and risk management firm focused on large corporate accounts
  • Former Chairman, President and CEO of Marsh McClennan founded Integro in 2005
• Transaction:
  • Cave Creek Capital participated with 12 institutional investors (including Weston Presidio, Leukadia, Highfields, and DLJ Merchant Banking) in $316 million Convertible Preferred Equity investment

• Results:
  • Attracted several high profile senior executives
  • Integro has grown to become one of the top 50 insurance agencies in the U.S.
  • Insurance Magazine customer surveys in 2008 and 2009 ranked Integro the #1 risk management insurance agency.
  • Completed acquisition of six specialty insurance agencies
  • Currently servicing over 500 blue chip corporate accounts