UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): June 4, 2012
AMSCAN HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
Delaware | 333-14107 | 13-3911462 | ||
(State or other jurisdiction of of incorporation or organization) |
(Commission File Number) |
(I.R.S. Employer Identification No.) |
80 Grasslands Road, Elmsford, New York 10523
(Address of Principal Executive Offices) (Zip Code)
Registrants telephone number, including area code: (914) 345-2020
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 8.01 | Other Events. |
Party City Holdings Inc. (Party City) announced that on June 4, 2012 it entered into a definitive agreement (the Agreement) pursuant to which funds affiliated with Thomas H. Lee Partners, L.P (THL) will acquire a majority stake in Party City in a recapitalization transaction (the Transaction) valued at $2.69 billion.
The equity proceeds payable to stockholders of Party City in connection with the Transaction will be determined by adding to such value the estimated cash, the estimated working capital adjustment, and the sum of the aggregate strike prices of all vested in-the-money options, and subtracting the outstanding debt.
The registrant, Amscan Holdings, Inc. (the Company), is a wholly-owned subsidiary of Party City. Amounts outstanding under the Companys ABL Credit Agreement dated August 13, 2010 and the Companys Term Loan Agreement dated December 2, 2010, as well as the Companys 8.75% Senior Subordinated Notes due 2014, will be repaid in connection with the closing of the Transaction.
Concurrently with the execution of the Agreement, stockholders of Party City affiliated with Advent International, Berkshire Partners and Weston Presidio (collectively, the Rollover Investors) executed a rollover letter (the Rollover Agreement) pursuant to which they committed to retain a portion of their respective investments in Party City. The completion of the Transaction is subject to certain customary conditions, including the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended. Party City anticipates that the Transaction will be completed in the third quarter of 2012.
On June 5, 2012, Party City and Thomas H. Lee Partners issued a joint press release announcing the execution of the Agreement. The press release is attached as Exhibit 99.1 and is incorporated herein by reference.
Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits
99.1 | Press Release issued on June 5, 2012. |
Signature
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
AMSCAN HOLDINGS, INC. | ||||||||
Date: June 5, 2012. | By: | /s/ Michael A. Correale | ||||||
Name: | Michael A. Correale | |||||||
Title: | Chief Financial Officer |
Exhibit 99.1
Thomas H. Lee Partners Acquires Majority Stake in Party City
Advent International, Berkshire Partners and Weston Presidio Join in $2.69 Billion Recapitalization Transaction
Boston, MA and Rockaway, NJ, June 5, 2012 Thomas H. Lee Partners, L.P. (THL), a leading private equity firm, announced today that it has signed a definitive agreement under which THL will acquire a majority stake in Party City Holdings Inc. (Party City), Americas premier party supplies retailer, in a recapitalization transaction valued at $2.69 billion. Advent International Corp. (Advent), Berkshire Partners LLC (Berkshire Partners), Weston Presidio (Weston Presidio) and company management, which currently own Party City, will continue to hold significant minority stakes following the recapitalization.
Party City leads the $10 billion retail party goods industry in terms of product selection and retail network. We look forward to working closely with the team at Party City to maximize its scale and vertically integrated business model to continue to grow its business, said Todd M. Abbrecht, a managing director at THL.
From its founding in 1947, the company has evolved to become a world-class company with widely recognized brands, a broad product offering, a strong global sourcing model and a category-defining retail concept, said Gerald C. Rittenberg, Party Citys Chief Executive Officer. The management team and I look forward to welcoming THL as an investor and working with the expanded shareholder group to position us for future growth across each of our channels. We are appreciative of the terrific partnership and guidance of our existing investors in the development and execution of our strategic plan.
Party Citys decorated party supply products are available in over 40,000 retail outlets worldwide, as well as in its own retail network of approximately 825 permanent party superstores and 400 temporary Halloween locations. The company also sells direct to customers through its e-commerce website, PartyCity.com.
Party City is by far the leader in the wholesale and retail party goods industry, said Steven J. Collins, a managing director at Advent International. With the additional leadership and support of THL, we believe the company is well-positioned to continue its successful development.
We are proud of Party Citys achievements since our original investment in 2004 and fortunate to have a long-standing, talented management team, said Robert J. Small, a managing director at Berkshire Partners. We believe the company is in an even better position today and are excited to remain partners with Gerry and his team for this next chapter of growth.
Kevin M. Hayes, a partner at Weston Presidio, said, We believe Party City has significant opportunities to enhance its leadership position in the party goods industry. We look forward to working with the THL team and our existing partners to help Party City pursue and achieve its growth objectives.
BofA Merrill Lynch and Moelis & Company acted as financial advisors and Weil, Gotshal & Manges LLP acted as legal advisor to THL. Goldman Sachs, & Co. and Deutsche Bank Securities Inc. acted as financial advisors to Party City. Ropes & Gray acted as legal advisor to Advent International, Berkshire Partners, Weston Presidio and Party City.
About Party City
Party City designs, manufactures, contracts for manufacture and distributes party goods, including paper and plastic tableware, metallic balloons, accessories, novelties, gifts and stationery. Party City also operates retail party goods and social expressions supply stores in the United States under the names Party City, Halloween City and Factory Card & Party Outlet. Party City is Americas largest party goods chain and the countrys premier retailer of Halloween costumes, theme party supplies, birthday decorations and other specialty party supplies.
About Thomas H. Lee Partners
Thomas H. Lee Partners, L.P. (THL) is one of the worlds oldest and most experienced private equity firms. The firm invests in growth-oriented global businesses, headquartered principally in North America, across three broad sectors: Consumer & Healthcare, Media & Information Services and Business & Financial Services. THLs team of investment and operating professionals partner with portfolio company management teams to identify and implement business process improvements that accelerate sustainable revenue and profit growth. Since its founding in 1974, THL has raised approximately $22 billion of equity capital and invested in more than 100 businesses with an aggregate purchase price of more than $150 billion. THL strives to build great companies of lasting value and generate superior investment returns. For more information, please visit www.thl.com.
About Advent International
Founded in 1984, Advent is one of the worlds leading global buyout firms, with offices in 16 countries on four continents. A driving force in international private equity for 27 years, Advent has built an unparalleled global platform of over 170 investment professionals across Western and Central Europe, North America, Latin America and Asia. The firm focuses on international buyouts, strategic repositioning opportunities and growth buyouts in five core sectors, working actively with management teams to drive revenue growth and earnings improvements in portfolio companies. Since its inception, Advent has raised $26 billion in private equity capital and, through its buyout programs, has completed over 270 transactions in 35 countries. For more information, please visit www.adventinternational.com.
About Berkshire Partners LLC
Berkshire Partners, a Boston-based private equity firm, has invested in over 100 middle market companies since 1986 through eight investment funds with aggregate capital commitments of $11 billion. Berkshire Partners has developed specific industry experience in several areas including consumer products and retail, business services, industrial manufacturing, transportation and communications. Berkshire Partners has a strong history of partnering with management teams to grow the companies in which we invest with the goal of consistently achieving superior investment returns. The firm seeks to invest $50 million to $500 million of equity capital in each portfolio company. For additional information, visit www.berkshirepartners.com.
About Weston Presidio
Weston Presidio, founded in 1991, is a private equity firm that has managed five investment funds aggregating over $3.3 billion. The firm focuses its investment activities on growth companies in the consumer, business services and industrial growth sectors. With offices in Boston and San Francisco, Weston Presidio targets middle market opportunities primarily in the United States. More information is available at www.westonpresidio.com.
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Contacts:
Matt Benson/Robin Weinberg, 212-687-8080, Sard Verbinnen & Co, for Thomas H. Lee Partners
Chuck Dohrenwend/Dana Gorman, 212-371-5999, The Abernathy MacGregor Group, for Party City Holdings, Advent International and Weston Presidio
Jennifer Boyce, Berkshire Partners, 617-227-0050