ABOUT TGP

Investment Profile

The Fund invests primarily in U.S.-based, middle-market companies with transaction values ranging from $15 million to $150 million, with a distinct focus on general manufacturing and business services companies located primarily in the greater Midwest.  Acquisition candidates include public and private companies, subsidiaries and divisions of public companies, companies anticipating generational change of ownership, private company owners seeking liquidity, and companies requiring capital for internal growth or acquisitions.  Depending on the opportunity, the Fund is open to either majority or minority equity ownership structures.  TGP Capital Partners has the capacity to invest up to $14 million in any one company, with a significant amount of additional equity capital available from our investors with a strong interest in co-investment opportunities.  We generally target a five to eight year investment horizon, during which time value should be realized for investors through profitable growth of the underlying business.  Click here to learn more about our Investment Strategies.

Management Focus

We believe that a successful investment strategy begins in partnering with the right management team.  We strive to partner with management teams that have demonstrated their ability to successfully manage and grow companies throughout economic cycles.  We believe that in order for a company to achieve success in the middle-market, a CEO must assemble a management team with various functional skills that each contribute to the value of the company as a whole.  Many smaller companies are run by entrepreneurs who continue to make the vast majority of decisions within their organizations.  These same companies may reach a point that their growth is limited by the experience and skill set of the entrepreneur.  We strive to partner with the appropriate leader, who recognizes the synergy and value created by building an experienced team as well as other  components of corporate infrastructure normally required in order to take any business to the “next level”.

Aligned Financial Incentives

We firmly believe that in order to get everyone focused on creating shareholder value, the financial incentives of the management team and the shareholders must be properly aligned.  To that end, we strongly encourage a significant equity investment by our management teams.  In addition, we put together a management incentive plan that provides the management team with the ability to earn up to 20% of the company’s equity value on a tax-advantaged basis upon the realization of the Fund’s investment.  

A True Partner with Management

For any partnership to be successful, each party must contribute and create value.  We believe in providing active support in our role as a true partner.  The Fund’s philosophical approach to investing focuses on management’s historical experience and their strategic plan.  The Fund’s professionals work extensively with management prior to any investment in order to understand and evaluate management’s strategic plan, and the challenges and opportunities inherent in the company at a micro level and the industry from a macro level.  We provide feedback as to the feasibility of the strategic plan and guidance as to what we believe the likely exit alternatives may be and the corresponding financial results to all parties if the strategic plan is achieved. 

The professionals of TGP Investments have extensive and wide ranging experience in mergers and acquisitions from the perspectives of both agent and principal.  This transaction and investment history has given us the ability to design and execute the appropriate capital structure for each opportunity.  Our experience also allows us to implement an extensive and aggressive game plan to identify and acquire add-on acquisitions for platform companies. Click here to learn more about our Principals.

We provide board level support and strategic feedback to management on major financial and operational decisions, but we do not interfere with management’s execution of its strategic plan.  When the strategic plan has been achieved, we provide guidance on maximizing shareholder value.   

Value-Added Governance Philosophy

TGP’s philosophy with a portfolio company’s board of directors is to build a team of talented, experienced professionals with relevant experience in order to bring great ideas, insights, and other resources for our portfolio company management teams.  Our Fund’s investors consist largely of individuals, most of whom are currently leading, or have historically led, successful middle-market companies.  In addition, our belief in management has also enabled us to meet and attract various successful, experienced executives in the business community.  We may use individuals as board members that can add real-world insight and experience to a portfolio company’s management team.  We also seek insights from existing management teams for potential director candidates to build the best board of directors possible to support and enhance the management team’s plan and long-term performance.