Monolith secures $230M for M&A
Consumer products company Monolith secured $230 million in financing for acquisitions, including its 12th acquisition that closed Tuesday night, co-CEO Jonathan Shifke tells Axios.
Why it's the BFD: Buyers that can line up the financing will be shopping as discounted valuations and consumer brands facing rising customer acquisition costs and inflation create more opportunities.
Details: The financing comprises a $150 million term loan, a $50 million Series A equity round and a $30 million asset-based loan.
- While the term loan will finance deals, the Series A and the ABL will go toward strategic initiatives and fund inventory, he says.
- The financing was led and advised by Hayfin Capital Management and Ares Management Credit Funds.
- Shifke declined to comment on the valuation or additional details on the structure of the recent deal.
Yes, and: To date, the consumer products group has raised a total of $390 million in debt and equity, Shifke says.
Between the lines: "We think it’s an interesting and compelling M&A landscape," Shifke says.
- The company will target profitable omnichannel businesses that have e-commerce and brick-and-mortar and generate between $2 million and $10 million in EBITDA.
- Pet tech companies are of particular interest currently, he says.
How it works: Monolith provides the capital, personnel and infrastructure, such as supply chain and distribution, to help grow its acquisitions.
- Co-CEO Pierre Abousleiman emphasizes it's a capital-intensive, M&A-focused business, so it was important to have the right capital structure and large institutional partners to pursue its strategy.
Of note: Shifke and Abousleiman both previously worked at private equity firm Blackstone, where they developed the idea for Monolith.
The bottom line: "What we’re looking for is sustainable, durable, profitable growth," Abousleiman says.