Versa Capital Management, LLC acquired Eastern Mountain Sports (EMS) in a deal the private equity firm said could enable the venerable New England outdoor retailer to continue developing its branded products and keep all 69 of its outdoor stores open.
Purchase terms were not disclosed. A unit of Duff & Phelps Corp. acted as exclusive financial advisor to EMS, and Gibson, Dunn & Crutcher LLP acted as legal advisor. Dechert LLP acted as legal advisor to Versa. Will Manzer, who led a management buyout of EMS in 2004, remains CEO at the New Hampshire based retailer.
Mark Walsh, a Versa principal and chairman of Bob’s Stores, will serve as chairman of the board of EMS. According to Walsh, no major initiatives will be considered until the company finishes the important holiday season.
“The EMS customer will see no change to the high touch, differentiated experience they are accustomed to in all of our locations and online,” Wash said.
Current plans call for exploring opportunities for Bob’s Stores and EMS to collaborate and for maintaining all of the current EMS stores. Based in Framingham, MA, Bob’s operated 34 stores with more than $300 million in sales when Versa acquired it in 2008. Today it operates more than 30 stores in Connecticut, Massachusetts, New Hampshire, New Jersey, New York and Rhode Island. EMS is based in Peterborough, N.H. and operates 69 stores in 12 eastern states from Maine to Virginia, including all six states where Bob’s Stores operate.
“Versa’s acquisition strengthens our future, and I am excited about the prospects before us,” said Manzer. “With Versa on board, all EMS associates can remain focused on delivering the very best level of support to our stores and to our customers during this holiday shopping season.”
Philadelphia-based Versa has $1.2 billion of assets under management. The firm buys controlling interests in special situations involving middle market companies where value and performance growth can be achieved through enhanced operational and financial management.
Versa received the “Private Equity Turnaround Deal of the Year” in July for its Chapter 11 reorganization and acquisition of American Laser Skincare, LLC. The company partnered with fellow private equity firm Crystal Management in 2008 to acquire Bob’s Stores from TJX Cos.
The deal comes toward the end of a challenging year for EMS, which was among many outdoor retailers hurt by last winter’s unseasonably warm weather. More recently, Hurricane Andrew forced the company to close or limit hours at several of its stores in New York and New Jersey during the week of the New York Marathon.
Manzer was in line to take over Perry Ellis in 2004 when he instead led a buyout of EMS financed by the private equity firm J.H. Whitney. Under his guidance, the retailer refocused on core outdoor enthusiasts, revamped its stores and real estate leases, and recruited designers to expand and improve EMS’ brand offerings. Manzer has also emerged as one of the industry’s most effective CEO advocates in Washington D.C. and is now finishing his second consecutive term as chairman of Outdoor Industry Association.
Eastern Mountain Sports began in 1967 when two Massachusetts rock climbers opened a store that would address the needs of quality climbers. That first store in Wellesley, Mass., was followed by growth opportunities in the 1980s and 1990s. Today, the Peterborough, NH-based retailer operates 69 stores in 12 states and employs approximately 1,500 people. For more information, visit www.EMS.com.
