Clearlake to make 5-6x its money with Ashley Stewart sale to Invus Group

Clearlake Capital Group LP stands to make a 5-6x return on its invested capital with the sale of Ashley Stewart Inc, a source familiar with the situation said.

Invus Group LLC said June 6 that it agreed to buy a controlling stake in the Secaucus, New Jersey, plus-size women’s clothing retailer. Clearlake and FirePine Group LLC were the sellers. Terms weren’t disclosed but Buyouts Insider reported June 2 that the deal was valued at $150 million.

Ashley Stewart has 89 stores across the United States, according to its website. James Rhee, FirePine’s founder, will continue as chairman and chief executive of Ashley Stewart.

“We feel incredibly fortunate that Invus will be bringing to bear its expertise in building great consumer brands as we introduce Ashley Stewart to the world,” Rhee said in a statement.

Clearlake, a Los Angeles private equity firm, acquired the retailer when it emerged from Chapter 11 bankruptcy in April 2014. The deal was valued at $18 million to $23 million, the WSJ reported at the time.

The investment is expected to produce a 100 percent-plus gross IRR for Clearlake, the source said.

Invus, a $5 billion investment firm, is an affiliate of Stichting Administratiekantoor Westend of the Netherlands. Investments include bluemercury, WeightWatchers and Keebler, the firm’s website said.

Clearlake used its third fund, which raised more than $785 million in 2012, to invest in Ashley Stewart. The PE firm closed its fourth private equity pool in September 2015 at $1.38 billion.

Fund III is generating a 28.2 percent net IRR and 1.4x investment multiple as of Sept. 30, according to performance data from California Public Employees’ Retirement System.

Chris Sciortino and Maria Watts of Robert W. Baird & Co  provided financial advice to Ashley Stewart, while O’Melveny & Myers acted as attorney.

Morgan Lewis served as legal adviser to FirePine Group.  Patterson Belknap served as legal adviser to Invus.

Invus and FirePine could not be reached for comment.

Action Item: Contact Invus: NYOffice@invus.com

Photo courtesy of Ashley Stewart