Capital Southwest Supports Mountaingate Capital’s Investment in Acceleration Partners

Rhea-AI Summary

Capital Southwest Corporation (Nasdaq: CSWC) announced its support for Mountaingate Capital's investment in Acceleration Partners LLC through a senior secured first lien term loan and equity investment. This partnership aims to enhance Acceleration Partners' capabilities in the partner marketing industry. With approximately $286 million in net assets as of September 30, 2020, Capital Southwest focuses on middle market businesses, offering financing solutions ranging from $5 to $25 million. The financing deal highlights a collaborative approach in fostering growth in digital marketing services.

Positive

• Capital Southwest is leading a financing deal for Acceleration Partners, indicating strong growth potential.
• The investment includes a senior secured first lien term loan and minority equity investment, providing financial flexibility.
• Capital Southwest has approximately $286 million in net assets, reinforcing its capacity to support middle market growth.

Negative

• Potential risks related to market changes and the impact of the COVID-19 pandemic could affect performance.
• Forward-looking statements in the PR highlight uncertainties and risks that may lead to actual results differing from expectations.

DALLAS, Dec. 09, 2020 (GLOBE NEWSWIRE) -- Capital Southwest Corporation (“Capital Southwest”) (Nasdaq: CSWC), an internally managed business development company focused on providing flexible financing solutions to support the acquisition and growth of middle market businesses, announced today that it supported Mountaingate Capital’s (“Mountaingate”) investment in Acceleration Partners LLC (“Acceleration Partners” or the “Company”) with a senior secured first lien term loan and delayed draw facility, as well as a minority equity investment. Capital Southwest led the financing. East West Bank provided a revolver and was a minority co-lender in the term loan and delayed draw facility.

"We are thrilled to partner with Mountaingate on another digital marketing services business through its investment in Acceleration Partners,” said Douglas Kelley, Managing Director of Capital Southwest. “Acceleration Partners’ management team has earned a remarkable reputation as the leader in the partner marketing industry.” Ryan Kelly, Principal of Capital Southwest, said, “Acceleration Partners helps brands efficiently grow their online marketing partnerships and we’re pleased to support Mountaingate’s vision of scaling the Company as they’ve done with their other marketing services platforms.”

Founded in 2007 and headquartered in Needham, MA, Acceleration Partners is the premier global partner marketing agency. By focusing on Better People, Better Process and Better Performance, the Acceleration Partners team sets the standard for how brands efficiently grow and refine their marketing partnerships anywhere in the world. A trusted agency partner to leading brands, Acceleration Partners’ team of seasoned marketers and industry experts help companies build meaningful, lasting, performance-based relationships with strategic partners. Acceleration Partners has received several prestigious awards and accolades for both client services and culture, including “Best Agency” (International Performance Marketing Awards), “Best Workplaces” (Inc.), “Best Places to Work” (Glassdoor), “Most Committed to Work-Life Balance” (Digiday).

About Capital Southwest

Capital Southwest Corporation (Nasdaq: CSWC) is a Dallas, Texas-based, internally managed business development company, with approximately $286 million in net assets as of September 30, 2020. Capital Southwest is a middle market lending firm focused on supporting the acquisition and growth of middle market businesses with $5 to $25 million investments across the capital structure, including first lien, unitranche, second lien, subordinated debt and non-control equity co-investments. As a public company with a permanent capital base, Capital Southwest has the flexibility to be creative in its financing solutions and to invest to support the growth of its portfolio companies over long periods of time.

About Mountaingate Capital

Mountaingate Capital, based in Denver, CO, is a private equity firm that specializes in building and empowering companies with strong growth potential and engaged leadership teams. The firm was launched by a team of partners with deep investment expertise in four distinct market sectors: marketing services, business/industrial services, specialty distribution and specialty manufacturing. Mountaingate’s focus on organic growth coupled with its proven customer-centric buy-and-build approach for add-on acquisitions and shared equity ownership with management creates more value for the end customer, while forging stronger, more collaborative, and more successful investment partnerships with management teams. In 2017, Mountaingate announced the close of its first fund with $395 million in capital commitments. Mountaingate targets investments in new platform companies typically with $5 million to $25 million of EBITDA. For more information on Mountaingate, please visit www.Mountaingate.com.

Forward-Looking Statements

This press release contains historical information and forward-looking statements with respect to the business and investments of Capital Southwest. Forward-looking statements are statements that are not historical statements and can often be identified by words such as "will," "believe," "expect" and similar expressions and variations or negatives of these words. These statements are based on management's current expectations, assumptions and beliefs. They are not guarantees of future results and are subject to numerous risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed in any forward-looking statement. These risks include risks related to: changes in the markets in which Capital Southwest invests; changes in the financial, capital, and lending markets; regulatory changes; tax treatment and general economic and business conditions; and uncertainties associated with the impact from the COVID-19 pandemic, including its impact on the global and U.S. capital markets and the global and U.S. economy, the length and duration of the COVID-19 outbreak in the United States as well as worldwide and the magnitude of the economic impact of that outbreak; the effect of the COVID-19 pandemic on our business prospects and the operational and financial performance of our portfolio companies, including our ability and their ability to achieve their respective objectives, and the effects of the disruptions caused by the COVID-19 pandemic on our ability to continue to effectively manage our business.

Readers should not place undue reliance on any forward-looking statements and are encouraged to review Capital Southwest's Annual Report on Form 10-K for the year ended March 31, 2020 and subsequent filings, including the "Risk Factors" sections therein, with the Securities and Exchange Commission for a more complete discussion of the risks and other factors that could affect any forward-looking statements. Except as required by the federal securities laws, Capital Southwest does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changing circumstances or any other reason after the date of this press release.

Investor Relations Contact:
Michael S. Sarner, Chief Financial Officer
214-884-3829

FAQ

What recent investment did Capital Southwest Corporation (CSWC) announce?

Capital Southwest announced its support for Mountaingate Capital's investment in Acceleration Partners LLC through a senior secured term loan and equity investment.

What is the financial capacity of Capital Southwest Corporation (CSWC)?

As of September 30, 2020, Capital Southwest has approximately $286 million in net assets.

What type of financing did Capital Southwest provide for Acceleration Partners?

Capital Southwest provided a senior secured first lien term loan and a minority equity investment.

How does Acceleration Partners contribute to marketing?

Acceleration Partners is a leader in the partner marketing industry, helping brands efficiently grow their online marketing partnerships.

What are the potential risks associated with Capital Southwest's investments?

The potential risks include market changes, economic conditions, and uncertainties related to the COVID-19 pandemic.