LOS ANGELES- Levine Leichtman Capital Partners (“LLCP”), a Los Angeles-based private equity firm, announced that it has entered into a definitive agreement to sell its portfolio company TSC Intermediate, Inc. (“Tropical Smoothie Cafe” or the “Company”) to private equity funds managed by Blackstone (“Blackstone”).
Tropical Smoothie Cafe is a leading franchisor of fast casual restaurants built on a mission to Inspire Better® with more than 1,400 locations across 44 states. The Company’s cafes offer a menu focused on inspiring a healthier lifestyle and includes “better-for-you” smoothies, wraps, sandwiches, bowls, salads, and flatbreads. With a menu mix of food and smoothies, the Company’s units generate attractive average unit volumes and capitalize on multiple dayparts, including breakfast, lunch, dinner, dessert, and snacks. The Company was founded in 1997 and is headquartered in Atlanta, Georgia.
Matthew Frankel, Managing Partner of LLCP, said, “Charles Watson and the Tropical Smoothie Cafe team have been terrific partners during a period of rapid growth with unit count nearly doubling since LLCP partnered with management to purchase the Company. Tropical Smoothie Cafe has been a phenomenal investment for LLCP given the Company’s robust franchise development activity and exceptional same-store sales growth. The accelerated growth we achieved working alongside their management team was driven by several key value creation initiatives, including accelerated unit signings and openings; strong digital sales growth; menu innovation; expansion of the management team; an increase in the proportion in higher AUV drive-thru units; supply chain improvements; and completing several highly strategic area developer buybacks. We are grateful for the partnership we had with the Tropical Smoothie Cafe team and wish the Company, their employees, and franchisees all the best in their next chapter of growth with Blackstone.”
Charles Watson, CEO of Tropical Smoothie Cafe, commented, “It has been a pleasure partnering with the LLCP team through this time of unprecedented growth, and we would like to thank them for their strategic insights and close relationship with our team over the years, and valuable contributions to our success. LLCP’s deep expertise in franchising combined with their management-centric approach made for the perfect partner in scaling our business. We have appreciated LLCP’s support in advancing our strategic initiatives and have benefitted greatly from the collaboration.”
Baird served as the lead financial advisor, with support from North Point and BofA Securities, and Kirkland & Ellis LLP served as legal counsel to Tropical Smoothie Cafe in connection with the sale.
About Levine Leichtman Capital Partners
Levine Leichtman Capital Partners, LLC is a middle-market private equity firm with a 40-year track record of investing across various targeted sectors, including Franchising & Multi-unit, Business Services, Education & Training and Engineered Products & Manufacturing. LLCP utilizes a differentiated Structured Private Equity investment strategy, combining debt and equity capital investments in portfolio companies. LLCP believes that by investing in a combination of debt and equity securities, it offers management teams growth capital in a highly tailored, flexible investment structure that can be a more attractive alternative than traditional private equity.
LLCP’s global team of dedicated investment professionals is led by 10 partners who have worked at LLCP for an average of 19 years. Since inception, LLCP has managed approximately $14.4 billion of institutional capital across 15 investment funds and has invested in over 100 portfolio companies. LLCP currently manages $9.6 billion of assets and has offices in Los Angeles, New York, Chicago, Miami, London, Stockholm, The Hague and Frankfurt.
