History
2005 and prior
TowerBrook Capital Partners was formed as a spin-off of George Soros' equity management firm.[4] TowerBrook's co-founders, Neal Moszkowski and Ramez Sousou, had previously served as co-heads of Soros Fund Management's private equity arm, Soros Private Equity (SPEP); SPEP launched its first fund around 2000.[7] SPEP was also an early investor[8] in companies such as Eircom,[4] CSTV Networks, and Cablecom, which it sold to Liberty Global in 2005.[8] In April 2005,[4] Moszkowski and Sousou spun out SPEP from Soros Fund Management to establish TowerBrook Capital Partners in New York and London.[9]
2006–2013
TowerBrook closed its TowerBrook Investors II LP fund at $1.3 billion in March 2006,[9] with George Soros contributing a significant amount.[10] Later that month, the fund purchased 67% of French engineering company GSE, which had an estimated value of €230 million.[11] In 2006,[12] TowerBrook purchased 75% of the St. Louis Blues National Hockey League team[13] for $150 million, also then purchasing the lease of the Scottrade Center in St. Louis, Missouri.[14] The purchase made TowerBrook "the only private equity firm to own a share in a professional sports team," according to Sports Business Daily.[12] Also in 2006, TowerBrook raised $850 million from the sale of WellCare Health Plans, and a further $160 million from the disposal of Tradedoubler.[7] After acquisition of clothing company Odlo in 2006,[15] in 2007 TowerBrook purchased the designer shoe company Jimmy Choo[10] for £180 million.[16] In 2007, it invested in U.S. company Sound Inpatient Physicians.[17]
In 2008, TowerBrook raised $2.8 billion from investors for its third fund.[10][18] According to Financial Times, the successful fundraising during a difficult economic period was noted as reflecting TowerBrook's sharp decline in its investing pace during a credit boom, while keeping debt for new investments "below the market average."[10] The fund's first deal was in 2009, when TowerBrook acquired 60% of Autodistribution Group for $139 million,[19] selling the stake six years later to Bain Capital.[20] In 2009, TowerBrook founded Haymarket Financial, or HayFin, initially as a corporate lender for small and medium businesses. Investors, including Sunseeker, Ronald Mourad Cohen, Lord Rothschild, and Future Fund, invested a total of $580 million in HayFin in September 2010, raising the lender's equity to about €1 billion.[21] TowerBrook sold its stake in HayFin in 2017.[22] In 2010, Towerbrook acquired the building company Monier[23] and sold Broadlane Group for $850 million.[24]
TowerBrook purchased the fashion retailer Phase Eight for £80 million in February 2011.[25] Three months later,[26] TowerBrook sold Jimmy Choo,[5] for a reported £500 million.[16] In 2012, TowerBrook sold part of its stake in the St. Louis Blues[14] to a consortium of investors, retaining a stake of around 50%.[27] Also in 2012, TowerBrook acquired a majority interest in the professional coaching business Vistage International.[28] In 2013, Towerbrook acquired scrap refiner Metallum for £295 million[29] and True Religion Apparel for $835 million.[13] That year, the company also sold Rave Cinemas to Cinemark.[30] In early 2013, The Financial Times wrote that TowerBrook was "defying a depressed fundraising market" by raising $3.5 billion for its new fund,[2] TowerBrook Investors IV.[31] Originally targeted at $3 billion, Fund IV became "considerably oversubscribed", receiving subscriptions of over $5 billion.[2]
2014–2020
In 2014, TowerBrook acquired Independent Clinical Services from The Blackstone Group for $408 million.[32] In June of that year, TowerBrook portfolio company Volution Group completed an initial public offering (IPO) on the London Stock Exchange,[33] diluting TowerBrook’s stake from 85%[34] to 61%.[35] In 2015, TowerBrook sold Phase Eight, then valued at £300 million, to the Foschini Group of South Africa,[25] and sold a 10% stake in itself to Wafra Investment Advisory Group "to free up capital to spend on the business."[36] In November 2015 TowerBrook secured over $800 million[37] for its new TowerBrook Structured Opportunities Fund,[38] exceeding its initial target of $600 million.[37] Also in 2015, Towerbrook purchased American Apparel business J.Jill[3][39] for around $400 million,[40] and acquired a stake in U.S.-based Accretive Health for $200 million.[41] In March 2016, TowerBrook sold the majority of Van Geloven, a Dutch snack maker it had acquired the previous year, to McCain Foods.[42] In April 2016, TowerBrook announced it was partnering with U.S.-based health system Ascension Health Alliance to develop Ascension's healthcare technology business TRIMEDX.[43] By that summer, the firm had raised a total of $9.4 billion from investors in four private equity funds and one structured opportunities fund, designed to allow the firm to make minority investments.[44][45]
The firm completed eight investments in 2017,[45] including purchasing 47% of the aerospace company Aernova[46] and acquisition of loyalty services business Rewards Network.[47] TowerBrook retained 50% of J.Jill stock when taking it public on the New York Stock Exchange in March 2017.[48] Several months later, True Religion filed for bankruptcy protection, stating that TowerBrook would "swap debt into equity, handing them majority control."[49] The bankruptcy plan was approved by the courts in October 2017,[50] with True Religion's debt cut by $354 million.[48]
In June 2018, $4.25 billion was raised for a new Towerbrook buyout fund, Towerbrook Investors V. $1.05 billion was also raised for a Structured Opportunities Fund.[44][45] In 2018 and 2019, TowerBrook made significant investments in Validity Finance,[51] GBA Group,[38] Orchid Underwriters[52] and Studio Movie Grill.[6] TowerBrook listed 30 active investments on its website in 2020, among them KeHe Distributors, BevMo!, and OVH.[53][6] In 2019, Towerbrook became the first "mainstream private-equity shop" to be certified as a B corporation.[54] In October 2019 it was reported that TowerBrook and Ascension Health were co-investing in the hospice company Compassus through Ascension TowerBrook Healthcare Opportunities (ATHO), a new joint venture.[55] In February 2020, the company was researching a sale of Independent Clinical Services.[56]
Business model
TowerBrook operates two fund types, private equity and structured opportunities.[44] TowerBrook's website states that its private equity strategy is "based on the focused, proprietary sourcing of selected, control-oriented" investments[57] in large and midsize companies,[44] where the firm has “identified scope for significant further improvement and value creation."[57] The firm's Structured Opportunities Funds make minority investments in a range of businesses,[44] "principally via structured asset and structured equity investments."[57] The firm publishes an annual "Responsible Ownership Report",[58] and is a signatory to the United Nations Principles for Responsible Investment Initiative (PRI).[59] Towerbrook is a certified B Corporation.[54]
Locations
TowerBrook is co-headquartered in London, England and New York City.[12] The firm also has offices in Madrid, Spain and Frankfurt, Germany,[57][60] and a representative office in Amsterdam.[61] It previously had an office in San Francisco, California[62] and also in Munich.[57]
Key People
The firm is led by its founders, Neal Moszkowski, and Ramez Sousou, who are its co-chairs and co-CEOs,[13] and are based in New York and London, respectively.[9] TowerBrook's 23-member senior advisory board includes David J. Barger, Daniel Bernard, Anne Bouverot, Dave Checketts, Andrew Feldman, Trevor Fetter, Alan Fishman, Reuben Jeffery III, Marwan Lahoud and Gareth Penny.[63]
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