Paul Laud and Colby Collier have teamed up – again – in launching Laud Collier & Co., a Livingston, N.J.-based private equity firm that will focus on the middle market. Both Laud and Collier had previously founded CIT Group’s private equity division, and decided to break away from the firm as it became evident the private equity group was not part of CIT’s core focus.
Despite the split from CIT, Laud Collier will continue to manage the company’s more-than-$200 million portfolio of invested capital that the Laud Collier principals themselves put together as part of CIT.
“This was not an asset disposition, though,” Laud, a founder and president at the firm, said. “Eighteen months ago, we approached CIT about going out on our own and agreed that we’d also manage CIT’s legacy portfolio on a contract basis.”
In addition to the management of CIT’s portfolio, the firm will also pursue its own new investments, but the focus will stay the same. Laud Collier will target companies with annual revenues between $25 million and $250 million and an enterprise value of $25 million to $150 million. Colby Collier, a founder and president of the firm, said that by targeting companies that fit in the firm’s price range, Laud Collier will be able to “distance [itself] from the mom-and-pop players,” but still come in below the radar of the “more competitive” large-market funds. Laud added that the performance of a company in that range is also typically easier to influence than that of a larger business. Generally, Laud Collier will keep its initial equity investments within a $10 million to $20 million range.
Laud Collier will focus on basic materials, business services, consumer products and transportation companies, a concentration that mirrors its past direction at CIT. “We tend to compete in the less mature and less consolidated industries, so we can find an investment with headroom to grow,” Laud said. The firm plans to avoid such sectors as oil and gas, real estate, technology development and retailing.
Additionally, the firm insists that a strong operating management team must be in place before it will make an investment in a company. “We like to go into an investment shoulder-to-shoulder with the management team,” Laud said.
While the firm has a new name and no longer sits underneath CIT’s umbrella, its faces are all the same. Laud Collier was able to pluck Kenneth Walters, Jr., Edward Burns and Michael Horgan from CIT and named Walters as a managing director, and both Burns and Horgan as vice presidents at the new firm.
As part of CIT, the Laud Collier team made a number of acquisitions throughout the U.S. and Canada, and counts Magic Cinemas, Sunbeam’s former thermometer maker Springfield Precision Instruments and specialized manufacturer Tru-Circle among its investments.