Surge Private Equity has made an investment in New York City-based Hippodrome Services Group, a provider of outsourced laundry and dry-cleaning services to four- and five-star hotels in Manhattan. No financial terms were disclosed. Harvest Capital Credit Corporation and Modern Bank N.A. provided the financing for the deal.
DALLAS–(BUSINESS WIRE)–On 08/01/2019, Dallas based Surge Private Equity (“Surge”) closed its investment of Manhattan based Hippodrome Services Group (“Hippodrome”) with financing provided by Harvest Capital Credit Corporation (“Harvest”) and Modern Bank, N.A. (“Modern”), which acted as administrative agent in the transaction.
Operating for 20+ years, Hippodrome provides outsourced laundry and dry-cleaning services to 4- and 5-star hotels in Manhattan. With a 9-year weighted average customer tenure, Hippodrome’s customer satisfaction is unparalleled in the Manhattan market. Due to its focus on high touch service and avoidance of lower-quality tunnel washing, Hippodrome has emerged as one of NYC’s premier providers in the Hotel laundry industry.
The deal closed with a >$10MM facility from Harvest and Modern, with seller Sam Pritsker retaining an equity stake in the business as he stays on to help expand.
Founder Sam Pritsker, said, “This is a tremendous opportunity for us, in our ability to better-service Manhattan. Surge brings the ability to modernize systems, controls, policies and procedures to further develop and refine our 24/7 customer service.”
Tom Beauchamp, Partner at Surge Private Equity, said, “Sam has built a remarkable business whose customer tenure speaks for itself. We see the value in this approach and believe we can improve the business he has built. Furthermore, this was a good fit for us given our ownership of Manhattan cleaning company Busy Bee Cleaning Services which we partnered with Harvest on as well.”
About Surge Private Equity
Surge Private Equity (https://www.SurgePE.com/) is a Dallas-based private equity firm that typically seeks majority investments in growing businesses with $2-7.5MM of EBITDA. Together with its lending partners, Surge provides entrepreneurs with liquidity and investors with higher yields and greater accessibility through lower investment minimums. Surge primarily invests in companies where the seller will remain on board in an ongoing capacity.
About Harvest Capital Credit
Harvest Capital Credit Corporation is a publicly traded Business Development Company (NASDAQ: HCAP) that provides customized financing to small and midsized businesses located throughout North America. Our products include senior secured debt, unitranche term loans, junior secured term loans, subordinated debt investments and minority equity co-investments.
About Modern Bank
Modern Bank, N.A. is a privately owned, entrepreneurial bank that provides flexible, competitive and reliable senior debt financing solutions to commercial companies. Our experienced bankers specialize in working with lower middle-market companies and their owners to provide low-cost cash flow based financing solutions. Whether expanding a business, acquiring a company, or financing a new product, clients have come to rely on our deep credit market and industry knowledge, and the ability to provide tailored solutions for a variety of credit-related needs.