Two private equity firms have taken a majority stake in the San Francisco maker of bicycle messenger bags for $20 million.
VMG Equity Partners and Capital Logic Partners have acquired a majority stake in San Francisco's Timbuk2 Designs Inc., a designer of bicycle messenger bags, in a deal a source said was valued at morethan $20 million. ( For more on this auction and others, visit AuctionBlockDatabase.com. )
The sellers were Pacific Community Ventures and other investors.
CapitalSource Finance LLC provided debt financing to support the purchase.
Additional details of the transaction, which was announced late Monday, were not disclosed.
Timbuk2 Designs "has a fabulous brand name that we believe can truly translate into a lifestyle brand,"said Scott Elaine Case, a managing partner at San Francisco–based VMG Equity Partners.
Case declined to comment on the deal's capital structure.
Established 16 year ago by a bicycle messenger, Timbuk2 is known primarily for its messenger—stylebags, although it also sells laptop-computer bags, duffel bags and accessories through major retailers.Through its Web site, the company also lets consumers design their own three-paneled bags.
Case said Timbuk2's growth strategy will revolve around the introduction of new products rather thanacquisitions.
She and fellow managing partner Michael Mauze made up VMG's deal team.
Mark Dwight, chief executive of Timbuk2, said the deal "provides us with the strategic perspective andfinancial backing to do the things we need to do as an emerging company."
"We're really focused on building the Timbuk2 brand — it's extensible to footwear and apparel," headded.
To that end, Dwight said Timberland chief operating officer Ken Pucker and Dennis Jenson, formerlypresident of Burton Snowboards, have been appointed to Timbuk2's board. Dwight will remain CEO ofthe company.
Timbuk2 is expected to generate $15 million in sales in 2005, compared with less than $4 million ofrevenue in 2002, said a person familiar with the company.
San Francisco–based Pacific Community Ventures realized a return of 4.5 times on its 3–year–oldinvestment in its minority stake in Timbuk2, according to Heidi Krauel, manager of business services atthe firm.