Norwest Equity Partners to Sell Jacobson Companies to Oak Hill Capital Partners

June 04, 2007


Minneapolis, Minnesota – Norwest Equity Partners (“NEP”), a leading equity investor focused on growing and profitable middle market companies, announced today that it has reached a definitive agreement to sell Jacobson Companies (“Jacobson” or “the Company”) to Oak Hill Capital Partners (“Oak Hill”), a middle market private equity firm. Jacobson, a national provider of third-party logistics services (“3PL”), has been in partnership with NEP since April 2004.

Concurrent with this transaction, NEP and Jacobson management together have plans to roll over a significant portion of their proceeds resulting in a 20% post-closing ownership position for the parties. The transaction is scheduled to close on June 19, 2007.

Craig Petermeier, Jacobson CEO, stated, “I remember sitting down with NEP right after the close of our deal in early 2004. We developed an aggressive acquisition strategy, and with the hard work of management under NEP’s leadership, we have executed it. With Oak Hill’s depth of experience and relationships, I look forward to continuing the same type of growth strategy with our new partner.”

Jacobson’s proven business model, growth potential and strong management team initially attracted NEP to the investment opportunity. Since then, the Company has tripled profitability and revenues under NEP’s ownership. Jacobson has also completed strategic add-on acquisitions to expand its geographic footprint, diversify its customer base and increase the number of services offered. These acquisitions include: Arthur Wells (July 2006); Wilpak (May 2006); Southwest Storage & Distribution (January 2006); and Bekins Logistics (February 2005).

Erik Torgerson, a NEP Partner and Jacobson board member, stated, “Under the leadership of Craig Petermeier and his management team, Jacobson has done a terrific job of establishing its niche within the highly-fragmented transportation and logistics industry space. It’s not often that NEP retains a meaningful ownership position in a business we are selling. What we are doing here speaks volumes about our confidence in the management team and the business model. We are just as excited today about the future of Jacobson as we were three years ago.”

Similar to NEP, Oak Hill was also attracted to Jacobson for its continued growth and value creation opportunities. Oak Hill has plans to leverage synergies and integrate one of its current portfolio companies, Arnold Logistics, into the Jacobson family of companies. Arnold Logistics is a warehouse and transportation focused outsourced 3PL provider based in Pennsylvania.

Ted Dardani, a Partner at Oak Hill, stated, “We are excited to partner with Craig and his outstanding management team. Jacobson has consistently delivered high-quality services and built profitable long-term customer relationships. Jacobson’s focus on innovative, customer-focused operations is one of its key competitive advantages within its sector, and its experienced, proven management team is well-positioned to execute against future growth opportunities.”

Founded in 1968 by Richard Jacobson and based in Des Moines, Iowa, Jacobson serves customers across a broad range of industry verticals.  Jacobson has several integrated services which include warehousing, packaging, freight management, transportation and industrial staffing.  Together with Arnold, Jacobson will expand as a national 3PL provider with an extensive network across the U.S.  The company will offer customized, fully outsourced, total supply chain solutions to help customers reduce supply chain costs and ultimately achieve a greater return on assets.  For more information, please visit www.jacobsonco.com.

In addition, NEP’s affiliated mezzanine fund, Norwest Mezzanine Partners, made a $17 million subordinated debt investment concurrent with NEP’s initial investment in Jacobson.

The transaction will be financed by a banking group to be led by Bear, Stearns & Co., CIBC World Markets Inc. and Wells Fargo & Co. Faegre & Benson, LLP and Nyemaster, Goode, West, Hansell & O’Brien, P.C. provided legal services to Norwest Equity Partners in this transaction.

John Thomson, Erik Torgerson and Todd Solow led the deal team for NEP.