Fort Worth, Tx -- (October 28, 2003) – The U.S. Growth Funds Corporation (USGF) announced today that it has executed an agreement to exit its investment in the factoring business operated under the trade name KBK Financial. A newly-created subsidiary of Marquette Financial Companies will acquire this business in an asset purchase, which is expected to close in approximately 30 days. Terms of the transaction were not disclosed.
KBK Financial has been a wholly-owned portfolio company since 1992, and is the largest and oldest factoring business based in the Southwestern United States. During 2002, KBK Financial purchased $500 million in factored receivables from middle market businesses across 25 states. Marquette Financial Companies is a $1 billion financial services company owned by the Carl Pohlad family in Minneapolis, Minnesota.
The factoring company will continue to operate under the name of KBK Financial and will become a subsidiary of Marquette Financial’s Meridian Bank, N.A. Company headquarters will continue to be based in Fort Worth, Texas, with marketing offices in Houston, Los Angeles and Atlanta. Substantially all employees of KBK Financial will be retained in the business, including Jack Roper, who will continue as president of this business.
“The acquisition of KBK’s factoring business fits with Marquette Financial Companies’ strategy to increase our presence in commercial finance,” said Bert Colianni, Executive Vice President and COO for Marquette Financial. He noted that KBK Financial will be the fifth company in Marquette Financial’s commercial finance portfolio, which also includes Builder’s Mortgage Company LLC, a provider of residential construction financing; Itasca Business Credit, an asset-based lender; Marquette Capital Partners, a provider of private capital; and Marquette Funding, Inc., a factoring company providing accounts receivable financing to the transportation industry.
“Because we see specialty commercial finance as an attractive part of our portfolio of businesses, we will provide the resources that will allow KBK Financial to grow,” Colianni said. “We also plan to grow our other existing businesses, and will continue to look for additional acquisitions in factoring and asset-based lending.”
“Marquette Financial and KBK Financial have similar strategies of serving businesses through relationship-based financial services,” said Jack Roper, KBK President, who will report to Colianni. “By working together with Marquette Financial, we believe KBK will have the best-in-class factoring services to assist our business clients.”
“Marquette is clearly endowed with the human, technical and financial resources required to grow this business to a scale of national leadership,” said Robert McGee, Chairman and CEO of U.S. Growth Funds. “Marquette’s capital strength, extensive experience in financial services and dedication to growth, will fuel exciting new opportunities for the KBK employees and customers.
“We are very pleased with this sale,” said McGee. “This sale attests to the soundness of our stated strategy of investing in high-growth, entrepreneurial businesses; installing professional and scaleable management practices; providing capital for growth and then ultimately selling the business.”
Marquette Financial concentrates its portfolio in three areas: commercial finance, commercial banking, and commercial mortgage banking. The KBK deal marks the third acquisition Marquette Financial has announced since May 2003. The first, Valley Bank of Arizona, has been combined into Community Bank of Arizona to create Meridian Bank, N.A., based in Phoenix, Arizona. The second acquisition merged the commercial real estate mortgage financing and mortgage servicing businesses of Legg Mason Real Estate Services, Inc. with NorthMarq Capital, based in Minneapolis, to create the third largest commercial real estate mortgage banking organization in the U.S.
About Marquette Financial Companies
Marquette Financial Companies is a $1 billion financial services company owned by the Carl Pohlad family in Minneapolis, Minn. The privately held company has a diversified portfolio of banks and specialty financial service companies.
About KBK Financial
KBK Financial is the largest and oldest commercial factoring business located in the Southwestern United States. KBK has provided more than $10 billion of financing to private and small publicly-held companies since its founding in 1962. KBK Financial, a leader in providing factoring services to middle market businesses in more than 25 states, purchased $500 million in factored receivables during 2002.
About U.S. Growth Funds Corporation
U.S. Growth Funds I (USGF) is a private equity firm that invests in acquisitions, recapitalizations and going-private transactions. To learn more about the private equity business of USGF. In addition to direct investments in middle market businesses, we also make selective and strategic investments in private equity funds focused on the lower middle market.
Media contact:
Mary Lilja
Lilja Inc. for Marquette Financial Companies
952.893.7140
mcl@lilja.com
Jenna Benner
U.S. Growth Funds
817.258.6024
mailto:jbenner@usgf.com
This press release contains forward-looking statements. The statements regarding expected results of U.S. Growth Funds Corporation are subject to various factors and uncertainties, including the uncertainties associated with the timing of transaction closings, changes in interest rates, availability of transactions, changes in regional or national economic conditions, or changes in the conditions of the industries in which U.S. Growth Funds Corporation has made investments. |
