About the Investment
Michaels of Oregon was a leading manufacturer of hunting, shooting and law enforcement accessories. With brand names such as Uncle Mike’s® and Uncle Mike’s Law Enforcement, the company manufactured and distributed holsters, slings, swivels, gun cases, belts, and other hunting, shooting, military and law enforcement gear. Michaels was originally founded in 1947 as a manufacturer of sling swivels for the gunsmith trade.NEP initially partnered with Michaels in 1993. As part of providing certain shareholders with liquidity, the company was recapitalized with new debt and additional equity in 2001 with NEP ownership increasing from 20% to 60%. NEP’s investment thesis at that time was to 1) purchase additional ownership in the company at a value price, 2) build it through value-added acquisitions in a highly-fragmented industry, 3) focus on internal margin enhancement opportunities, and 4) sell it at an enhanced multiple by shifting the center of the company away from handguns to law enforcement and sporting goods.
Post recapitalization, Michaels expanded its product offering by acquiring Hoppe’s®, the leader in gun cleaning products. In continuation of its growth strategy, Michaels consolidated four of its locations into a newly built manufacturing and distribution facility in Meridian, Idaho, and management developed an offshore sourcing strategy for a select number of products that resulted in significant cost savings. Michaels completed the acquisition of StoneyPoint® in 2004, which added gun and shooting products to its product offering and entered into a licensing agreement with Blackwater Gear™ that significantly strengthened its law enforcement business.
Over the course of NEP’s investment, successful execution of the company’s strategy resulted in strong earnings growth and an exit multiple of over two times greater than the initial purchase price. Michaels was sold to Bushnell® Performance Optics, a portfolio company of Wind Point Partners in August 2005. Michaels of Oregon remains the leading manufacturer of hunting, shooting and law enforcement accessories.
NEP Investment Date
May 2001
November 1993
Add-On Activity
- StoneyPoint Products (May 2004)
- Hoppes (April 2001)
- Butler Creek (May 1996)
