“We’re seeing a lot of VCs ask about continuation funds. With companies staying private longer, it is an attractive liquidity solution for LPs. But there are risks involved for both the fund and the investors.” – Shruti Gurudanti, Rose Law Group director of corporate transactions
By Rose Law Group Reporter
NEW YORK, Jan. 4, 2024 /PRNewswire/ — Palladium Equity Partners, LLC (“Palladium”) today announced the close of a $450 million multi-asset continuation vehicle that has acquired interests in three assets – Sky Zone, Del Real Foods, and Jordan’s Skinny Mixes – from Palladium Equity Partners IV, L.P. (“Fund IV”), which closed on $1.14 billion in 2014.
As part of the transaction, limited partners in Fund IV were provided the option to cash out of their interests in the assets, roll their interests into the continuation fund, or stay in Fund IV at the same terms. BlackRock’s Secondaries & Liquidity Solutions team (on behalf of certain managed funds and accounts) acted as the lead investor in the transaction.
Justin R. Green, Partner and Co-Head of Flagship Funds at Palladium, said, “We are proud of the success Sky Zone, Del Real Foods and Jordan’s Skinny Mixes have achieved to date and believe this continuation vehicle provides further opportunity to participate in the appreciation of the value of these strong, growing companies. This continuation vehicle was structured in a manner that we believe aligns interests while offering favorable outcomes for LPs, according to their individual views on liquidity.”
The three assets in the new continuation fund are:
- Sky Zone, a premier indoor active entertainment destination, which owns, operates and franchises over 240 parks across the U.S. and Canada. The company helps its over 350,000 members and millions of yearly visitors make memorable moments with more than 60 smile-inducing attractions. Sky Zone elevates celebrations to the extraordinary, hosting millions of children at unforgettable birthday, team, and school parties every year.
- Del Real Foods, a manufacturer of traditionally-inspired, branded and private label, heat-and-serve, Hispanic cuisine products, including value-added meats, prepared specialty items, fresh salsas and side dishes. The company sells its convenient, clean-label products to the club, retail, foodservice and wholesale distributor channels, and is the largest producer of fresh tamales in the country, selling over 80 million tamales annually.
- Jordan’s Skinny Mixes, a provider of branded low-calorie coffee syrups and flavorings, whipped foam toppings, and beverage mixes. Skinny Mixes are sold in in more than 13,000 specialty retail locations across the U.S., Canada, Australia and Europe.
Palladium had previously fully-realized 6 companies from Fund IV.
Raymond James acted as financial advisor and Proskauer served as legal advisor on the formation of the multi-asset continuation vehicle.
