Pacific Elite, an operator of collision repair shops in California and Crash Champions, a collision repair business in the greater Chicago area, have merged. As part of the merger, Pacific Elite secured an investment from A&M Capital Opportunities, which invested in Crash Champions last year. No financial terms were disclosed. B. Riley FBR, Inc and Ferruzzo & Ferruzzo LLP advised Pacific Elite while Goodwin Procter LLP advised AMCO.
DOWNEY, Calif. and CHICAGO, March 18, 2020 /PRNewswire/ — Pacific Elite and its affiliated companies (“Pacific Elite” or the “Company”), the largest family owned operator of collision repair shops in California, today announced a merger with Crash Champions, LLC, a leading regional collision repair business in the greater Chicago area.
The newly combined company (“CombineCo”) will be the 5th largest independent MSO in the country, with an established presence in two key metropolitan markets – Southern California and Chicago. Pacific Elite co-founders Tim Mullahey and Mike Salyards will retain an ownership stake in CombineCo and remain active in the business focusing on operations and growth.
“This business partnership with Crash Champions is a major milestone for our company,” said Tim Mullahey, founder and CEO of Pacific Elite. “Mike and I started Pacific Elite in 1998 with the shared goal of providing the highest level of customer care to vehicles with collision damage. We have made significant progress thus far in reaching our goal, and we now have a partner in Crash Champions with a shared emphasis on operational excellence and customer satisfaction, as well as the industry expertise in the Midwest to help us grow our footprint and further enhance the customer experience in our shops.”
Matt Ebert, CEO and founder of Crash Champions, added, “In joining forces with Pacific Elite, another one of the industry’s most respected and fastest growing regional collision repair platforms, Crash
Champions is now positioned to take advantage of the scale benefits of being a national MSO and create further regional diversity in new geographic markets. Just like Pacific Elite, we pride ourselves on giving our customers a high-quality experience and creating a rewarding work environment for our shop employees, and I look forward to working together to amplify our efforts in this regard.”
As part of this business combination, Pacific Elite secured an investment from A&M Capital Opportunities (“AMCO”), a growth focused middle-market private equity fund that made an investment into Crash Champions in July of last year. The investment will provide Pacific Elite with a capital partner to accelerate the Company’s buy-and-build strategy and support identified growth initiatives.
“After seriously considering a range of different options, we are confident that this combination of two leading regional providers with the financial backing of a capital partner that is well-versed in the automotive collision repair industry is the best path forward to realize our expansion ambitions, and we could not be more energized about the future of our company,” said Mike Salyards, President of Pacific Elite.
Pacific Elite was advised by B. Riley FBR, Inc and Ferruzzo & Ferruzzo LLP. AMCO was advised by Goodwin Procter LLP. Debt financing was led by Madison Funding with participation from Antares Capital and BMO Sponsor Finance. Terms of the deal were not disclosed.
About Pacific Elite
Established in 1998 and headquartered in Downey, CA, Pacific Elite began as a single-shop operation in Fullerton, California, and now operates 23 collision repair shop locations within the Southern California market.
About Crash Champions
Crash Champions began in 1999 with a small shop in New Lenox, IL, called New Lenox Auto Body. After over 15 years of owning a small neighborhood collision center, Matt Ebert wanted to bring his vision to towns throughout the Chicagoland area. In 2014, the company’s name was changed to Crash Champions-New Lenox and the brand began to grow. Since 2014, the Crash Champions organization has grown to have 16 collision centers throughout the Chicago market and became a regional leader in collision repair. In 2020, with Crash Champions strong success, the company began its rapid growth strategy with its first out-of-market acquisition located in Columbus, OH. What makes Crash Champions truly different is its employees – each one embodies everything that it takes to be a true Champion. For more information, visit www.crashchampions.com.
About A&M Capital Opportunities
A&M Capital Opportunities, with total capital commitments of $500 million, is Alvarez & Marsal Capital’s lower middle market growth strategy, focused on shared control and structured minority equity investments in North America. AMCO partners with business owners and management teams to help recapitalize and grow businesses, leveraging deep operational capabilities and industry relationships to position them for accelerated long-term growth. AMCO has significant experience with all types of transactions, including growth equity, growth buyouts, recapitalizations, and consolidations of fragmented sectors.
About Alvarez & Marsal Capital
Alvarez & Marsal Capital (“AMC”) is a multi-strategy private equity investment firm with over $3 billion in total capital commitments across four funds and three investment strategies. The privately-owned firm is led by a highly experienced investment team, which is augmented by its strategic association with Alvarez & Marsal (“A&M”), one of the largest operationally-focused advisory firms in the world. AMC’s business model combines a focus on middle-market private equity investing with the deep operational expertise, industry knowledge and global corporate relationships of A&M, making it a uniquely attractive partner to management teams, corporates and business owners. https://www.a-mcapital.com/
About B. Riley FBR
B. Riley FBR provides corporate finance, research and sales and trading to corporate, institutional and high net worth individual clients. Investment banking services include initial, secondary and follow-on offerings, institutional private placements and merger and acquisitions advisory services, and corporate restructuring. The firm is nationally recognized for its highly ranked proprietary equity research. B. Riley FBR is a subsidiary of B. Riley Financial (NASDAQ:RILY). To learn more, visit www.brileyfbr.com.