April 7, 2020, Mexico City – Alta Growth Capital (“AGC”), a leading private equity firm focused on growth investing in Latin America, recently received the LAVCA 2020 Private Equity Deal award for its investment in Fruehauf, a Mexico-based manufacturer of semi-trailers. A panel composed of judges from several international institutional investors, including development finance institutions, insurance companies, pension funds, and trusts, selected AGC’s Fruehauf investment as the best performing LATAM Private Equity deal of the year considering company transformation, IRR, EBITDA, governance, and, where relevant, social and environmental impact.
Fruehauf was a buyout deal in AGC’s Fund II that closed in 2015. AGC initially saw in Fruehauf a company with significant virtues, including positive cash flow generation and growth potential, opportunities for management and governance improvements, institutionalization and a reasonable entry valuation. The company is the Mexico operation and a legacy asset of the original Fruehauf Trailer Corporation that entered bankruptcy during the 1990’s. Fruehauf Trailer Corporation created the semi-trailer category and at one time was the leading and largest manufacturer of semi-trailers in the world.
With a new management team installed by AGC and a new growth orientation, Fruehauf saw a considerable expansion of its customer base, entered key markets, and generated significant cost efficiencies during its tenure as an AGC portfolio company. AGC exited the investment with the sale of Fruehauf to Mexican conglomerate Fultra in March 2019, less than four years after acquiring the company, having doubled both the company’s sales and EBITDA and successfully reentering the U.S. market following a 20-year absence. The deal highlights that the opportunities for growth in emerging markets are there when investors focus on under-served markets and on operational value-add that translates into long-term, sustainable shareholder value.
“We are very pleased to receive this award from LAVCA and for the recognition by the judges of our efforts to achieve outstanding results for all of our stakeholders,” said Scott McDonough, Managing Director of AGC. “We enjoyed very much being part of the amazing Fruehauf legacy and are happy that we were able to revive the Fruehauf brand in North America and bring it back to the U.S.”
“The Fruehauf outcome was the result of a tremendous effort by AGC and the company’s strengthened management team to reorient the company towards growth while making the operation more efficient and institutional,” said Javier Garcia-Teruel, Managing Director of AGC. “This investment shows that a disciplined and focused approach to private equity can be very successful in Mexico and Latin America, even under challenging economic conditions.”
About Alta Growth Capital
Alta Growth Capital, based in Mexico City, manages private equity funds focused on growth equity and buyouts in middle-market companies in Mexico and Latin America. AGC has been operating in Mexico since 2007 and is currently investing out of its Fund III.
About LAVCA
LAVCA is the Association for Private Capital Investment in Latin America, a not-for-profit membership organization dedicated to supporting the growth of private capital in Latin America and the Caribbean. LAVCA’s membership is comprised of over 190 firms, from leading global investment firms active in the region and local fund managers to family offices, global sovereign wealth funds, corporate investors, and international pension plans. Member firms control assets in excess of US$65b, directed at capitalizing and growing Latin American businesses. LAVCA’s mission – to spur regional economic growth by advancing private capital investment – is accomplished through programs of research, networking forums, education and advocacy of sound public policy. Visit www.lavca.org for more information.
For more information, please visit www.agcmexico.com or contact
Scott McDonough, Managing Director
Alta Growth Capital
+52 (55) 5254-3280
scottm@agcmexico.com
