HM Capital Partners LLC

  • Overview

Flipping out

HM Capital is the private equity business's equivalent of house flippers; it takes underperforming companies, builds them up and then sells them or takes them public for profit.  Since the company first opened in 1989, it has been successful in launching some big-name brands into the public marketplace, including Ghirardelli, Clear Channel, Crain Industries and the Morningstar Group.  The firm is currently managing more than $3.4 billion in funds.

HM Capital's typical transaction can range anywhere from $100 million to more than $1 billion.  HM Capital calls its investment strategy "Buy-and-Build," meaning that it takes an active role in beefing up the companies it acquires before selling them.  The "build" portion of this method includes making value-creating initiatives such as extending product lines, expanding into new territories and streamlining production and administrative costs.

By any other name

If you don't recognize the name HM Capital, it may be because the firm has spent many of its 19 years in the business with a different moniker.  When John Muse and Tom Hicks opened the company in 1989, they named it Hicks, Muse & Co.  In 1994, Hicks and Muse welcomed two new partners, Charles Tate and John Furst, and changed the name to HMTF Capital.  The company remained HMTF for the remainder of the 1990s and the first part of the following decade.  However, after the telecom bubble burst in 2001, HMTF's balance sheet took a huge blow, resulting in Tate and Hicks exiting the company.  In 2006, with John Muse now at the helm, HMTF Capital added Edward Herring, Eric Lindberg and Jason Downing as new partners to the firm and officially changed the name to HM Capital.

One deal at a time

HM Capital suffered huge losses during the Internet and telecommunications bust of 2000 to 2001, becoming one of the biggest private equity casualties of the era.  Its European arm officially separated from its American parent company, and the firm lost half of its original partnership.  However, after the rebranding move in 2006, HM Capital is making a serious effort to launch itself back into the private equity game for good.  The firm's progress since then has been slow but steady.

As of August, the company had only made one significant purchase in 2008, the acquisition of oil and gas exploration firm TriDimensional Energy.  This falls in line with HM Capital's recent investment strategy, the company has spent $3 billion in energy deals alone in the past four years.  In 2007, the company added two companies to its portfolio: Advanced H20 and Phone Directories Company, L.P.  Advanced H20 is a private label bottled water company, while Phone Directories is, as its name implies, one of the largest providers of yellow page directories in the United States.  HM Capital's other current portfolio companies include Canpages, (a Canadian directory provider), Choice Cable TV (a Puerto Rican media firm), LinTV, Swett & Crawford, Sturm Foods, UniTek USA and Viasystems.  Two of the most recent acquisitions of the firm include MaineToday Media, Inc., a media company that owns the largest newspaper in Maine (Portland Press Herald/Maine Sunday Telegram), in February 2009, and SunTerra Resources, a newly formed, energy-sector company, in March 2009.



HM Capital Partners LLC


200 Crescent Court
Suite 1600
Dallas, TX 75201
Phone: (214) 740-7300
Fax: (214) 720-7888
www.hmtf.com

STATS


  • Employer Type: Private
  • Chairman: John R. Muse
  • 2007 Employees: 2,500

Key Financials

  • 2007 Revenue: $245 million