Blue Sage Capital: 2015 In Retrospect

Blue Sage Capital rounded out a productive and rewarding year.

Blue Sage Capital II

In July, we completed the purchase of Marine Accessories Corporation (“MAC”). Located in Knoxville, TN, MAC is the leading designer and manufacturer of wakeboard towers, bimini tops, custom boat covers and related accessories sold to OEMs, dealers and direct to consumers.

In August, we partnered with management to complete the recapitalization of this Hot Springs, AR manufacturer of timber automation equipment. Owned and operated by a team that has worked together for over three decades, Baxley-LogPro manufactures equipment that facilitates the efficient flow of timber in sawmills: scanners, sorters, stackers, edgers, and trimmers, as well as log cranes and de-barkers that are used in the woodyards of saw, paper, and pellet mills.

Blue Sage Capital I

With ten full years elapsed, Fund I is nearing its final wind down. During 2015, we successfully exited two investments from this 2004 vintage fund. In June, we sold Gatti’s Pizza to Sovrano, Inc. In July, we sold Parker School Uniforms to an investor group comprised of Salem Investment Partners, Plexus Capital, and Argosy Investment Partners.

We have now exited eleven of the thirteen investments from our inaugural fund, returning nearly four times invested capital to our private capital Limited Partners. We are grateful to our operating partners, trusted advisors, key intermediaries and gifted service providers who helped us create this value in a wildly disparate economic environment; from formation and fundraising amidst the uncertainty and chaos created by the events of September 11, 2001, through an investment period characterized by a proliferation of new funds and additional liquidity, to a harvest period in which the economy experienced a systemic failure and endured a global recession.

Erica Holland | ModMoney

Team

We are pleased to announce the promotion of Erica Holland to Senior Associate. In this role, Erica will assist with the evaluation, structure, due diligence, and financial modeling of investment opportunities and maintain portfolio company monitoring responsibility. Erica joined Blue Sage in 2013 after spending two years with J.P. Morgan's Investment Bank in New York City. Originally from El Paso, Erica graduated summa cum laude from Duke University with a Bachelor of Science in Economics and minors in Markets and Management Studies and Cultural Anthropology.

2016

We enter 2016 with optimism and excitement. While there are many questions surrounding the macroeconomic environment including interest rate speculation in the wake of long deferred Federal Reserve action and the underlying price of oil, a catalyst that uniquely impacts companies in our backyard, we believe our foundational investment tenets work across economic cycles. We are actively investing our sophomore fund and are selectively seeking well-run, basic industrial, distribution, manufacturing and business services companies that enjoy leadership positions in their respective industry verticals.

We are particularly keen to work with founders and business owners as their first institutional capital partner, providing liquidity for estate planning and other needs while investing intellectual capital to grow businesses into their next chapter. Our capital is flexible, and we have the ability to invest pure common equity, and/or junior debt. Our optimal capital commitment is $15 to $20 million, which, depending on variables including ongoing ownership and senior bank debt, fits best for companies with $20 to $100 million in revenues and $3 to $12 million in EBITDA.

About Blue Sage Capital

Blue Sage Capital is an Austin, Texas-based private equity firm specializing in growth, recapitalization and buyout financings of smaller middle market companies based in Texas and the Southwest. Most of Blue Sage’s investments are in established, profitable companies with $20 million to $100 million of revenue and $3 million to $12 million of cash flow at the time of investment. Blue Sage invests in a variety of industries, with each initial investment typically ranging from $10 million to $20 million.

For more information regarding Blue Sage, please visit www.bluesage.com or contact Peter Huff at 512.536.1901.