Overview of the New Continuation Fund
Brentwood Associates, a leading private equity firm known for its strategic and growth-oriented investments, has officially closed an impressive $410 million continuation fund aimed at fueling the expansion of Watermill Express, LLC. This fund's purpose is to enhance the operational capabilities of Watermill Express, a prominent provider of self-service drinking water and ice solutions.
Reasons Behind the Fund's Launch
The closing of this continuation fund allows Brentwood Associates to reinforce its collaboration with Watermill and its experienced management team while also injecting crucial capital that will support the Company through its next growth phase. This strategic investment is primarily backed by Hollyport Capital as the lead investor, with Pantheon and Portfolio Advisors providing additional support as co-lead investors.
Watermill's Growth Journey
Founded in 1984, Watermill Express has grown to operate nearly 1,300 self-service stations, predominantly serving communities in the West Coast and Sunbelt regions. Over its extensive history, the Company has provided safe drinking water and ice to over 10 million residents, significantly reducing reliance on single-use plastic bottles. The effective management has led to substantial growth; Watermill Express has tripled its adjusted EBITDA by strategically expanding its locations and enhancing its existing stations into water-and-ice units.
Future Development Prospects
The future looks promising for Watermill Express, which is poised for organic growth. The plan includes opening additional self-service stations, upgrading existing water-only stations, and exploring acquisitions to broaden its geographic reach and service offerings within the drinking water and ice market. This course of action reflects broader community health trends and the increasing demand for environmentally friendly water solutions.
Management's Perspective on Growth Potential
According to Eric Reiter, a Partner at Brentwood Associates and Chairman of the Board at Watermill, this transaction exemplifies their unwavering confidence in the Company’s mission to deliver affordable and accessible clean water nationwide. He emphasized the incredible performance of Watermill and the social impact that comes from providing essential services to communities.
Expert Insights on the Investment
Mike Gallagher, the CEO of Watermill, expressed excitement over the transaction, affirming that the Company is now exceptionally well-funded to tackle the clean water challenges facing America. For over 40 years, Watermill’s kiosks have provided communities with necessary access to safe water and ice. Gallagher highlighted the significance of partnerships with grocery and convenience stores, as well as shopping centers, which adds to the appeal of this essential service in various neighborhoods.
Investor Feedback on the Partnership
Toros Yeremyan, a Managing Director at Brentwood, expressed gratitude towards existing and new investors, recognizing their support through this continuation fund. He noted that the process enabled an accelerated realization option for investors at market-driven prices while enhancing Watermill's growth strategy.
Support and Guidance from Partners
Richard Grindrod, a Partner at Hollyport, articulated his enthusiasm for expanding their partnership with Brentwood and backing Watermill’s further growth. This collaboration signals trust in the ongoing commitment to providing sustainable and affordable water solutions to consumers.
About Watermill Express
Headquartered in Brighton, CO, Watermill Express has established itself as a premier provider of drive-up refill stations for drinking water and ice, leveraging its vast network to promote environmental sustainability. The Company is on a robust path, continuously serving diverse communities while staying true to its mission of making water accessible for everyone.
About Brentwood Associates
Brentwood Associates is an established private equity investment firm with over 30 years of experience in the middle-market, focusing on essential services. Since its inception, Brentwood has made investments in over 50 companies, showcasing its expertise in fostering brand development and management cooperation, contributing to significant positive impacts in diverse markets.
Frequently Asked Questions
What is the purpose of the new continuation fund by Brentwood Associates?
The fund is intended to support the continued growth of Watermill Express by providing additional capital for expansion and operational enhancements.
How has Watermill Express contributed to environmental sustainability?
Watermill has significantly reduced plastic waste, helping prevent over 15 billion single-use plastic bottles from entering landfills through its self-service stations.
Who are the major investors in the continuation fund?
The continuation fund is primarily backed by Hollyport Capital, with Pantheon and Portfolio Advisors also participating as co-lead investors.
What future strategies does Watermill have for growth?
Watermill plans to open more self-service stations, upgrade existing ones, and pursue strategic acquisitions to enhance its market presence.
What is the historical impact of Watermill Express?
Over the past 40 years, Watermill has provided clean water and ice to over 10 million people, ensuring access to essential services across different communities.
