TorQuest acquires Prepac
TORONTO – TorQuest Partners, a private equity firm based here, has acquired a majority stake in Prepac Manufacturing Ltd., a producer of ready-to-assemble furniture sold predominantly through online retailers headquartered across North America.
The terms were not disclosed.
Prepac was founded in 1979 by Steve Simpson, and is based in Delta, British Columbia. It started out as a shelving manufacturer, selling its products through traditional brick and mortar retailers and hardware stores. In the late 1990s, Prepac was an early mover into the online retail space and began drop-shipping its products directly from its manufacturing facility to the end-customer’s doorstep.
Since then, the company has significantly expanded its operations and today sells its bedroom, multi-media, home office, entryway and storage products exclusively through the largest online furniture retailers in including both the Canadian and U.S. branches of Amazon, Wayfair, Cymax and Overstock. It also supplies the e-commerce arms of brick-and-mortar retailers such as Best Buy, Home Depot and Walmart, once again, on both sides of the border.
Prepac will continue to be run by its president, Jim Mathison, and its senior management team – all of whom are partner investors in the transaction. Simpson will also retain a significant investment in the business and will sit on the board of directors.
“Steve Simpson and the management team have steered the business on an impressive growth trajectory over many years. The expertise within the business and operational excellence give us great confidence that the business will continue to thrive,” Rachel Skelton, a principal at TorQuest Partners, said in a statement.
“I am extremely proud of the accomplishments of the Prepac team and believe it is the right time, and TorQuest is the right partner, to take the business forward. I’m pleased to be leaving the business with a great foundation, ready for its next stage of growth,” Simpson added.
Prepac, which exhibits at the twice-yearly Las Vegas Market, is can ship product from its state-of-the-art facility within 48 hours, on average and sends out thousands of orders daily.
Mathison doesn’t anticipate any shifts in the company’s priorities under the new ownership.
“Our focus on our retail customers and end consumers will remain core to our business strategy as we continue to grow our market share in North America. We see incredible opportunity for our business and our customers, in this thriving marketplace,” he said.
TorQuest Partners, a Canadian firm, has some $2 billion of equity capital under management, and specialises in middle market companies and works closely with management to build value. Among its better-known investments are A&W Food Services, the Canadian fast food chain, and Rubicion Pharmacies, a health care provider in Western Canada. It was also behind Herbal Magic, the chain or commercial weight loss centres, for a number of years.
“This is the eighth platform investment for TorQuest Partners Fund IV and continues our well-established strategy of building relationships with successful Canadian entrepreneurs to help transition their businesses over time and support their management teams in the next phase of growth,” partner Daniel Sonshine added.