Unique Forays into Gift Industry –

American women buy candles more often than lipstick. That’s according to Joe Phillips, principal of Anaheim, Calif.-based private equity firm Unique Partners, which, with that in mind, has acquired 80% of Gold Canyon Candles, a scented-candle maker.

The management of Gold Canyon Candles retained the other 20% of the Phoenix-based company, and Imperial Bank and Wells Fargo Mezzanine helped to finance the deal, according to a release.

Unique made the transaction through the $40 million Unique Growth Capital Partners fund. That fund is fully invested, but Phillips explained his firm used a bridge to Fund II, for which the firm expects a first close “later this year.”

Gold Canyon Candles makes aromatherapy candles, candle accessories and other personal care products.

“Gold Canyon Candles has a strong track record and exceptional growth rates,” said Phillips. It has grown in excess of 100% for four years.” The company was founded in 1996.

The acquisition of Gold Canyon Candles represents Unique’s foray into the gifts and decorative accessories industry.

“We had a relationship with one of the company owners,” said Phillips, “who is also one of the owners of Qqest Software Systems Inc.,” one of Unique’s portfolio companies.

Unique plans on building the company’s infrastructure and national direct sales and marketing force. And although Unique has “no specific acquisition plans” Phillips said it may use Gold Canyon Candles as a platform company through which to acquire other candle companies that use the same distribution system, that is, home candle parties rather than retail.

Like Tupperware in its heyday, Phillips said, this form of distribution has “nice margins.” It also means “the exit strategy is built in,” as “there are multi-million companies with the same distribution channel” that might provide a strategic exit. Phillips said they are on a three-to-five-year exit plan.

The firm, which invests in manufacturing and business services in companies with between $15 million and $50 million in revenue or enterprise value, sold its portfolio company Hawker Pacific Aerospace to strategic acquirer Lufthansa Technik AG in fall 2000. Lufthansa Technik AG is a wholly owned subsidiary of Lufthansa, one of the largest airlines in Europe.

Scott Hartman and John Makoff founded Unique Partners in 1993. The firm focuses on acquisitions of mid-market companies in the Western U.S. Deal size ranges from $3 million to $20 million. The firm focuses on companies in the technology, health-care, business services, electronics, and manufacturing industries.