Management Buyout: Seasoned Executive

Pipp Mobile Storage Systems Holding Company

Walker, Michigan

Type of business: Provider of mobile storage systems for backroom organization

Situation: In 2005, operating executive Craig Umans sought a private equity partner to back him in the acquisition of Pipp Mobile Storage Systems, Inc. (Pipp), a leading provider of backroom mobile storage systems. Mr. Umans was a 25-year veteran of the store-fixture industry, most recently serving as CEO of manufacturer RHC/Spacemaster Corporation. With the aid of an investment banker, he was looking to find the right financial partner to help him close the Pipp transaction and work closely with him to grow the business. Prospect Partners saw significant potential in Pipp, already a strong performer in its niche market, under Mr. Umans' leadership. Mr. Umans had wide-ranging relationships, significant experience in new product development, and a clear vision for the business. The two felt an immediate rapport, and the partnership began.

Our Strategy: Pipp's mission was to be the market leader in backroom organization by becoming a "one-stop shop" for all retail storage management needs. Pipp served retailers nationwide, from small mall-based locations to national mass merchants, offering custom storage solutions that met the needs of the entire spectrum of retailers. Mr. Umans sought to deepen and broaden Pipp's customer base and capitalize on Pipp's efficient delivery model. To achieve that goal, Pipp invested in marketing, new product development, and select add-on acquisitions that expanded the company's offering and reach. Prospect Partners performed all mergers-and-acquisition functions: identifying and qualifying prospects, conducting financial modeling and due diligence, and negotiating, structuring, and financing deals.

Results: Pipp became the market leader in retail back-office management. In 2007 and 2011, Pipp acquired leading providers of mobile storage and inventory management solutions, which expanded the company's mobile storage management offering and gave Pipp a presence in new market segments, including foodservice and hospitality. As a result of these transactions and investment in internal growth and operational efficiencies, Pipp's revenue grew five-fold during Prospect Partners' seven-year investment period.

Exit: In December, 2012, Prospect Partners and management sold their interests in Pipp for a significant gain to a larger financial buyer. Management re-invested in the transaction to benefit from the next phase of the company's growth.

Our Philosophy: To be a genuine partner to Mr. Umans throughout all business cycles, providing thoughtful strategic counsel and committed financial resources that allowed him to confidently pursue and achieve his business plan for Pipp.

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"Prospect Partners did exactly what they said they would do: They let me run the company while providing exceptional guidance and support, especially for our two add-on acquisitions. In our seven years together, Prospect Partners was always consistent, realistic, level-headed, and a lot of fun to work with. They were exactly the guys they said they'd be."

—Craig Umans, CEO,
Pipp Mobile Storage Systems, Inc.


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