Main Street Announces Exit of Portfolio Investment

Rhea-AI Summary

Main Street Capital Corporation (NYSE: MAIN) has successfully exited its debt and equity investments in J&J Services, Inc. upon its sale to a strategic buyer. This transaction yielded a gain of $11.0 million, exceeding the fair market value by $5.0 million as of June 30, 2021. Main Street's total investment in J&J was $24.8 million, with an impressive annual internal rate of return of 59.2% on the equity side, translating to a 2.5x return on investment. Main Street's efforts significantly contributed to J&J's operational growth in the Nashville market.

Positive

• Realized a gain of $11.0 million from the exit of the investment.
• Total investment of $24.8 million yielded a 59.2% annual internal rate of return on equity.
• 2.5x return on equity investment, reflecting successful portfolio management.

Negative

• None.

HOUSTON, Nov. 3, 2021 /PRNewswire/ -- Main Street Capital Corporation (NYSE: MAIN) ("Main Street") is pleased to announce that it recently fully exited its debt and equity investments in J&J Services, Inc. ("J&J" or the "Company) upon the sale of the Company to a strategic acquiror. Founded in 2000 and headquartered in Nashville, Tennessee, J&J is a second-generation family owned and operated business providing roll-off dumpster and portable toilet rental services to an expansive base of residential, commercial and demolition customers. Main Street realized a gain of $11.0 million on the exit of its equity investment in J&J, with this realized value representing an increase of $5.0 million above Main Street's fair market value for this investment as of June 30^th, 2021. 

Main Street, along with its co-investors, partnered with J&J's founders and senior management team to facilitate the recapitalization of the Company in October 2019. Through a combination of first-lien, senior secured term debt and a direct equity investment, Main Street invested $24.8 million in the Company. Over the course of Main Street's investment, J&J invested heavily in its fleet assets to further strengthen the Company's best-in-class service reputation and leading market share position within the rapidly growing Nashville and Middle Tennessee markets. On a cumulative basis since Main Street's investment in J&J in October 2019, Main Street realized an annual internal rate of return of 59.2% and a 2.5x times money invested return on its equity investment and an annual internal rate of return of 31.6% and a 1.6x times money invested return including both Main Street's debt and equity investments.

ABOUT MAIN STREET CAPITAL CORPORATION
Main Street (www.mainstcapital.com) is a principal investment firm that primarily provides long-term debt and equity capital to lower middle market companies and debt capital to middle market companies.  Main Street's portfolio investments are typically made to support management buyouts, recapitalizations, growth financings, refinancings and acquisitions of companies that operate in diverse industry sectors.  Main Street seeks to partner with entrepreneurs, business owners and management teams and generally provides "one stop" financing alternatives within its lower middle market portfolio.  Main Street's lower middle market companies generally have annual revenues between $10 million and $150 million.  Main Street's middle market debt investments are made in businesses that are generally larger in size than its lower middle market portfolio companies.

Main Street, through its wholly owned portfolio company MSC Adviser I, LLC ("MSC Adviser"), also maintains an asset management business through which it manages investments for external parties. MSC Adviser is registered as an investment adviser under the Investment Advisers Act of 1940.

Contacts:
Main Street Capital Corporation
Dwayne L. Hyzak, CEO, dhyzak@mainstcapital.com  
Jesse E. Morris, CFO and COO, jmorris@mainstcapital.com                 
713-350-6000

Dennard Lascar Investor Relations
Ken Dennard | ken@dennardlascar.com  
Zach Vaughan | zvaughan@dennardlascar.com  
713-529-6600

 

View original content:https://www.prnewswire.com/news-releases/main-street-announces-exit-of-portfolio-investment-301415006.html

SOURCE Main Street Capital Corporation

FAQ

What was the gain from Main Street's investment in J&J Services?

Main Street realized a gain of $11.0 million from its investment in J&J Services.

What was the total amount Main Street invested in J&J Services?

Main Street invested a total of $24.8 million in J&J Services.

What was the internal rate of return on Main Street's investment in J&J?

Main Street achieved an annual internal rate of return of 59.2% on its equity investment in J&J Services.

When did Main Street partner with J&J Services?

Main Street partnered with J&J Services in October 2019 for recapitalization.

Where is J&J Services located?

J&J Services is headquartered in Nashville, Tennessee.