Investment Criteria

We partner with management to make control equity investments in LBOs and recapitalizations of lower middle market businesses. We pursue niche-market leaders that provide high-margin products or services.

Our transactions typically provide liquidity to shareholders of privately owned businesses, facilitate transition of ownership to key managers, and allow management to capitalize on growth opportunities.

We see what others miss

Milestone has distinguished itself among its peers by identifying solid fundamental long-term value that went underappreciated by others. We don’t have all the answers, but we listen and we are creative.

Type of Investment:

  • Control equity investments in:
  • Leveraged buyouts
  • Management buyouts
  • Recapitalizations
  • Buy-and-build strategies
  • Minority investments on a selective basis

Platform Investment Parameters:

  • Revenue: $15–$150 million
  • EBITDA: $3–$20 million
  • Transaction size: $15–$150 million
  • Equity Investment: $5–$40 million
  • Headquarters in North America (may have significant overseas operations)

Add-on Investments:

  • We seek to support all of our platform companies with capital and resources for add-on acquisitions
  • No size minimum

 

Desirable business characteristics include:

Healthy, successful businesses

We target companies with at least a three-year track record of solid operating profitability and growth, preferring businesses with proven margins that are superior to those of comparable peer companies. We employ a generalist approach, targeting proven businesses in all industries.

Market leader or leadership potential

The companies we target often have competitive advantages such as proprietary business models or manufacturing processes, or sell highly regarded products or services. A proprietary approach provides the company with a defensible, competitive position and the potential to become, or maintain a position as, a leader in that industry.

Recognizable growth potential

The ability to demonstrate attractive, sustainable growth opportunities is a priority in our consideration process.

Exceptional management teams

We will invest only when proven management teams with demonstrated records of success are part of the opportunity. We expect key managers to have a meaningful financial stake in the success or failure of their portfolio company. We look for entrepreneurs who are of the highest integrity, have had substantial P&L and balance sheet responsibility, accept advice and criticism willingly, have a professional demeanor in their interactions with investors, customers, partners and advisors, and have the ability to attract additional talented executives. Our operating partner program can also provide talented managers from a variety of industries to augment or advise and assist incumbent management teams.

Clear exit strategy

A thorough understanding of exit alternatives is a critical element in evaluating an investment. Investments must have multiple potential exit opportunities, which should not be dependent on industry cycles. Milestone typically builds a platform to sell to a broad array of potential buyers, including larger private equity firms and strategic corporate buyers in similar or related industries.