Recapitalization & Growth Capital

Achievement products manufacturer receives financing for a recapitalization

Headquartered in Austin, TX, American Achievement Corporation is a leading manufacturer and marketer of yearbooks, class rings, graduation products and achievement products under the Balfour and ArtCarved brands. The company’s products are sold through two distinct business segments: (i) publishing, which includes the yearbook and fine book business, and (ii) scholastic, which includes class rings, letter jackets, graduation products, including caps and gowns, personalized recognition products and event related jewelry, including championship rings. AAC holds an established market leading position in the Southwestern and Southeastern U.S.

AAC is majority owned by Fenway Partners, a New York based middle-market private equity sponsor who Prudential Capital Group has partnered with in the past. In early 2015, Fenway contacted Prudential Capital regarding a prospective transaction to refinance the AAC’s senior credit facility and high yield bonds that were approaching maturity. Additionally, AAC was seeking acquisition financing for the purchase of Gaspard, a cap and gown supplier with a presence in Canada and Puerto Rico. Fenway was looking for a flexible junior capital partner that could help with both of these objectives and would have the capital and interest in supporting future growth through acquisitions.

Prudential Capital was able to underwrite and structure the entire junior capital financing and provide a flexible solution consisting of $65 million of senior subordinated notes and $46 million of preferred equity. Prudential Capital brought in a co-investor in order to preserve follow-on capacity to support the business, but remained the lead junior capital investor with approximately $71 million. AAC concurrently closed a $330 million senior facility with a senior lender group led by a core Prudential Capital relationship.

Management and Fenway chose to partner with Prudential Capital based on a favorable prior partnership, Prudential Capital’s experience executing similar recapitalization transactions, certainty of execution, and ability to underwrite and lead a flexible junior capital solution that covered the full initial capital need as well as provided capacity to support future add-on needs of the company. This transaction closed in September 2015.