Newport Beach-based private equity firm Marwit Capital LLC is looking to step up investing of a $183 million fund it raised earlier this year.
Marwit expects to invest in 12 to 15 businesses in all, committing at least half of the fund by the end of the year. The firm has invested in about half a dozen companies so far with more deals in the works.
To find companies to invest in, Marwit has struck a pact with the Orange County chapter of the National Women’s Business Owners Organization, a networking group for businesswomen.
Marwit hopes to use the organization to find companies to invest in and executives to run them.
“Working with NAWBO is a way to network and build relationships,” said Matthew Witte, managing partner of Marwit.
Many of the companies Marwit invests in come from referrals, managing partner Chris Britt said.
The firm is working with NAWBO member Camille Jayne, who’s set to head up one of Marwit’s future acquisitions.
Jayne runs her own Irvine consultancy, Matters at Hand, and is the former chief executive of Cypress-based remote control maker Universal Electronics Inc.
“I like their intensity and due diligence,” Jayne said of Marwit.
She’s helping Marwit search out companies, including one she’ll be chief executive of.
Marwit’s most recent deal was the October buy of Orange-based Boot Barn Inc., a Western-themed clothing store chain.
Marwit plans to announce another local acquisition in the next couple of months, according to its partners. About 60% of Marwit’s investing is in OC, Witte said.
“This is a well stocked pond to go fishing in and there are not a lot of fishermen,” Witte said.
What Marwit saw in Boot Barn was a stable company that wasn’t prone to shifting fashion trends. It was family run for 30 years.
With about $70 million in revenue, Boot Barn was founded by Ken Meany and run by son Patrick Meany.
It has 32 stores in the Western U.S.
Patrick Meany reinvested in the company and is staying on as chief executive.
Marwit added a seasoned retail executive, John Turnbull, to the company as president and chief financial officer.
The Boot Barn investment came from a referral from the law firm that Marwit and the Meanys share.
Retail is one of seven industries Marwit is looking at. The others include healthcare, manufacturing and service companies.
“We look for industries with no regional or national leadership, where we could come in and become that,” Witte said.
The strategy is to buy controlling interests in companies with investments of $10 million to $25 million each.
Marwit seeks to make three times its original investment, according to Witte.
The firm may use as much as 65% in debt on its investments.
A typical company will have yearly revenue of $20 million to $50 million and be established in its industry, Britt said.
Jayne is set to run a company with larger revenue, she said.
Recent Investments
Other companies Marwit has invested in with its latest fund are Traffic Control & Safety Corp., a collection of traffic control companies that includes Anaheim-based American Barricade Inc.
Marwit also owns Utah-based Best Vinyl, a vinyl fence installer and distributor, El Monte-based Driftwood Dairy, which supplies milk to schools, and Texas-based Solis Women’s Health, a breast cancer screener.
In OC, Marwit has invested in Newport Beach-based Promax Nutrition Corp. and Irvine-based Paciolan Inc., a ticketing company that IAC/Interactive Corp.’s Ticketmaster is in the process of buying.
Investors in Marwit’s fund include the California Public Employees’ Retirement System, as well as individuals.
Marwit has been operating in the county since 1962 when Witte’s father, Martin, founded the firm.
The new generation of Marwit began in 1994 with partners Witte and Britt.
