Compass Diversified (CODI) announced that it has completed the sale of its majority-owned subsidiary, Liberty Safe Holding Corporation, the parent company of Liberty Safe and Security Products, Inc. to an affiliate of Monomoy Capital Partners.
The sale price of Liberty was based on an aggregate enterprise value of $147.5 million plus estimated cash and working capital adjustments subject to customary post-closing true-ups. After these adjustments and for an allocation to Liberty’s non-controlling shareholders and the payment of transaction expenses, CODI received approximately $127 million of total proceeds from the sale at closing. This amount was in respect of its debt and equity interests in Liberty and the payment of accrued interest. As previously announced, CODI expects to record a gain of approximately $75 million to $85 million from the sale.
Net proceeds will be used for general corporate purposes and to fund the previously announced special distribution of $0.88 per common share in connection with CODI’s anticipated tax reclassification.
Elias Sabo, CEO, Compass Diversified, stated, “Since acquiring Liberty in 2010, we have taken a number of steps to scale the business and cement Liberty’s leading status among its customers and dealer network. Together with management, we achieved a strong return on our investment in Liberty through a long-term approach to value creation enabled by the flexibility of our permanent capital structure. We thank the Liberty team for their significant contributions and look forward to their continued success.”
Lincoln International LLC acted as financial advisor and Squire Patton Boggs (US) LLP acted as legal counsel to CODI. Ropes & Gray LLP acted as legal advisor to Monomoy.
CODI’s business holdings include 5.11, Boa Technology, Marucci Sports and Velocity Outdoor in the active lifestyle space. Other businesses include Advanced Circuits, Arnold Magnetic Technologies, Ergobaby, Foam Fabricators, and Sterno.
Photo courtesy Liberty Safe
