Falconhead Leads Acquisition of Water and Snow Sports Company

Jan. 19, 2017 8:00 a.m. ET
Falconhead Capital said it acquired Kwik Tek Inc., a maker of water skis, kayaks and snowshoes, to accelerate the outdoor leisure company's expansion efforts.
The firm teamed up with M3 Investments LLC to acquire the Denver company, according to a news release. Financial terms weren't disclosed. Falconhead Capital decided to participate in the auction for Kwik Tek about six months ago, said a person familiar with the situation. Founded in 1991, Kwik Tek malces and supplies products for the water- and wintersports
markets. Items include trelddng poles, sleds, rafts, wakeboards, life vests and pool floats.The new investment will enable Kwik Tek to focus on growing the company both
organically and through potential acquisitions, the person said, explaining the outdoor leisure sector itself has been increasing at a fast rate. Kwik Tek has been expanding at "an incredibly fast pace" and has the potential to be much bigger, the person added. The outdoor leisure sector has experienced steady deal activity. Businesses in the space
have been attractive to private equity because they can present an opportunity to launch a platform amid market fragmentation, industry bankers have said. These businesses also have enjoyed strong growth par ticularly from millennial customers, they said. For example, Peak Rock Capital in November acquired Do Outdoors Inc., a supplier of branded fishing reels, rods and accessories that does business as Lew's Fishing. Bruckmann Rosser Sherrill & Co. in July said it bought Daisy Outdoor Products, a Rogers, Ark., maker and marketer of youth air guns and accessories.
J.P. Morgan Chase & Co. provided senior revolver financing and LBC Credit Partners offered senior term financing. Lazard Middle Market LLC advised Kwik Tek on the deal.
Greenberg Traurig LLP advised Falconhead. M3 Investments is led byindustryveteran Michael Noell, who founded and sold tactical and military equipment company Blackhawk Industries Products Group Unlimited LLC to publicly traded aerospace and defense company Alliant Techsystems Inc. in 2010. Falconhead targets companies in the sports, media and entertainment; recreational equipment and apparel; personal care and wellness; food and beverage; and consumer services sectors. The private-equity firm typically deploys $10 million and $100 million
of equity per platform investment. The New York firm recently sold Rita's Franchise Co. to Argosy Private Equity and MTN Capital Partners.

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