Case Study

Kidsline, Inc.

After meeting Century Park Capital and then reviewing their proposal, we were sure we had found a true partner who understood our business model, its attributes and challenges, and understood and appreciated our needs and expectations. They delivered exactly what they promised. Always supportive and available for consultation, they added enormous value in their areas of expertise but assiduously kept from meddling in the company’s day-to-day operations.

Michael Levin

Former President and CEO, Kidsline, Inc.

Overview

Kidsline, Inc. designs, produces, and markets infant bedding and coordinated accessories. Century Park Capital proposed and completed a minority recapitalization that met the owners’ liquidity goals and also allowed them to retain control of the company. The company doubled revenues and profits through organic growth over a relatively short investment period and was sold to a publicly traded acquirer, which provided an attractive return to Century Park and provided the original owners a “second bite of the apple”.

Highlights

  • Key supplier in its product categories
  • Long product life cycles
  • Superior customer satisfaction

Details

Headquarters – South Gate, California
Industry – Consumer Products
Website – kidslineinc.com

The Situation

Kidsline was a Southern California designer and producer of infant bedding and accessories. The business was family owned and operated, and in 2001 the owners decided to capitalize on their success and to diversify their financial holdings. This resulted in the decision to pursue a sale of the company.

How We Helped

Century Park listened to the goals of the owners and realized that a leveraged recapitalization could be a more beneficial transaction structure for all of those involved. The owners of the company sought to diversify their assets, but believed strongly in the potential for continued growth and success of Kidsline. Century Park worked cooperatively to structure a transaction whereby the owners were able to take a significant amount of capital off the table while maintaining a majority ownership position in the company. The owners chose this option over other proposals because it gave them the opportunity to remain involved in the business and to participate in the next stage of growth in partnership with Century Park. The relationship that developed between the owners and Century Park was the key to forging the transaction and a close working arrangement. The owners were confident that Century Park was exactly the type of partner they wanted and could trust to bring the business to the next level.

The Result

After the transaction was consummated, Century Park and management worked together to implement key initiatives to accelerate the company’s growth. Over the next three years, Kidsline’s revenues, EBITDA, profit margins and market position improved substantially. Ultimately, Century Park guided the stronger, larger Company through a sale to a publicly traded strategic buyer. Some of the key steps included:

  • Hired a new CFO to broaden and professionalize the management team.
  • Enhanced the Company’s board of directors with a member of Century Park’s Executive Council who was previously the founder and CEO of a much larger manufacturer and marketer of soft goods.
  • Purchased and implemented a new MIS platform to enable management to control the growing enterprise.
  • Evaluated numerous strategic acquisitions.
  • Implemented a management incentive stock plan for new and existing management.