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The Road to Competitiveness Puerto Rico Manufacturers Association January 17, 2008
CONTENTS <ul><li>Miradero Capital Partners, Inc. </li></ul><ul><li>Puerto Rico Entrepreneurs Fund, L.P. </li></ul><ul><li>...
<ul><li>Miradero Capital Partners </li></ul>
Miradero Capital Partners, Inc. Overview <ul><li>Private equity investment firm established in March, 2000 and based in Sa...
<ul><li>Puerto Rico Entrepreneurs Fund </li></ul>
Puerto Rico Entrepreneurs Fund Overview <ul><li>$31.2 million private equity investment fund based in San Juan, Puerto Ric...
Puerto Rico Entrepreneurs Fund  Capitalization Other Private Investors include funds of funds, corporations and high net w...
<ul><li>Investment Activities </li></ul>
<ul><li>Target Industries </li></ul><ul><ul><li>Not restricted to any industry </li></ul></ul><ul><li>Investment Types </l...
<ul><li>Approximately $12 million invested to date in ten portfolio companies. </li></ul><ul><li>A diversified group of co...
<ul><li>Realized Investments (4): </li></ul><ul><ul><li>Three successful exits. </li></ul></ul><ul><ul><li>One total loss....
Investment Activities Investment Criteria <ul><li>Attractive Valuation & Investment Structure </li></ul><ul><li>Multiple E...
Investment Activities Case Study – BTB Corporation <ul><li>Project Description:   3 managers with more than 40 years of co...
Investment Activities Case Study – Rocket Learning <ul><li>Project Description:   Start up provider of supplemental educat...
Investment Activities Case Study – Pronatura <ul><li>Project Description:   Corporate divestiture of recycling operation n...
<ul><li>Investments for Competitiveness </li></ul>
<ul><li>Company Owner: </li></ul><ul><ul><li>Plant expansion or modernization </li></ul></ul><ul><ul><li>Product and marke...
<ul><li>Negotiation: </li></ul><ul><ul><li>Purchase price and structure </li></ul></ul><ul><ul><li>Legal documentation </l...
<ul><li>We are slow and thorough in our analysis. </li></ul><ul><li>We are more selective. </li></ul><ul><li>We want you t...
Puerto Rico Entrepreneurs Fund, L.P. “ Partnering with Entrepreneurs to Build Value” Union Plaza, Suite 1500 416 Ponce de ...
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Miradero Capital Partners

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  • Transcript of "Miradero Capital Partners"

    1. 1. The Road to Competitiveness Puerto Rico Manufacturers Association January 17, 2008
    2. 2. CONTENTS <ul><li>Miradero Capital Partners, Inc. </li></ul><ul><li>Puerto Rico Entrepreneurs Fund, L.P. </li></ul><ul><li>Investment Activities </li></ul><ul><li>Investments for Competitiveness </li></ul>
    3. 3. <ul><li>Miradero Capital Partners </li></ul>
    4. 4. Miradero Capital Partners, Inc. Overview <ul><li>Private equity investment firm established in March, 2000 and based in San Juan, Puerto Rico. </li></ul><ul><li>Staff with extensive business and investment experience: </li></ul><ul><ul><li>Investment Professionals </li></ul></ul><ul><ul><ul><li>Zoilo Méndez, Managing Director </li></ul></ul></ul><ul><ul><ul><li>Abdón Ruiz, Managing Director </li></ul></ul></ul><ul><ul><ul><li>Valentina Pirazzi, Senior Analyst </li></ul></ul></ul><ul><ul><li>Management Consultants </li></ul></ul><ul><ul><ul><li>Mario S. Belaval </li></ul></ul></ul><ul><ul><ul><li>Ivan Tenreyro, CPA, CVA </li></ul></ul></ul><ul><ul><ul><li>Francisco Uriarte, PE </li></ul></ul></ul><ul><li>General Partner and Manager of Puerto Rico Entrepreneurs Fund, L.P. </li></ul>
    5. 5. <ul><li>Puerto Rico Entrepreneurs Fund </li></ul>
    6. 6. Puerto Rico Entrepreneurs Fund Overview <ul><li>$31.2 million private equity investment fund based in San Juan, Puerto Rico. </li></ul><ul><li>Organized on November 30, 2001 as a Delaware limited partnership licensed under the Puerto Rico Venture Capital Funds Act of 1999. </li></ul><ul><li>Licensed on September 18, 2002 as a Small Business Investment Company (“SBIC”) by the U.S. Small Business Administration (“SBA”). </li></ul>Formed with the primary goal of providing financing to businesses in Puerto Rico, mainly in the growth and expansion stages, through equity investments or debt financings.
    7. 7. Puerto Rico Entrepreneurs Fund Capitalization Other Private Investors include funds of funds, corporations and high net worth individuals. 4.20 MM Banks $31.20 MM Total Capital 2.85 MM Other Private Investors 3.35 MM PR Government 20.80 MM SBA Investment
    8. 8. <ul><li>Investment Activities </li></ul>
    9. 9. <ul><li>Target Industries </li></ul><ul><ul><li>Not restricted to any industry </li></ul></ul><ul><li>Investment Types </li></ul><ul><ul><li>Convertible Preferred Stock </li></ul></ul><ul><ul><li>Subordinated Debt </li></ul></ul><ul><li>Investment Size </li></ul><ul><ul><li>Preferred Minimum - $500,000 </li></ul></ul><ul><ul><li>Preferred Maximum - $1.5 million </li></ul></ul><ul><ul><li>Absolute Minimum - $250,000 </li></ul></ul><ul><ul><li>Absolute Maximum - $2.1 million </li></ul></ul><ul><li>Investment Exit </li></ul><ul><ul><li>5 - 7 year Investment Horizon </li></ul></ul>Investment Activities Preferred Parameters
    10. 10. <ul><li>Approximately $12 million invested to date in ten portfolio companies. </li></ul><ul><li>A diversified group of companies: </li></ul><ul><ul><li>Distribution (3) </li></ul></ul><ul><ul><li>Media </li></ul></ul><ul><ul><li>Entertainment </li></ul></ul><ul><ul><li>Manufacturing </li></ul></ul><ul><ul><li>Healthcare Services </li></ul></ul><ul><ul><li>Educational Services </li></ul></ul><ul><ul><li>Waste Management / Recycling </li></ul></ul><ul><ul><li>Biotechnology / Personalized Medicine </li></ul></ul>Investment Activities Investments to Date
    11. 11. <ul><li>Realized Investments (4): </li></ul><ul><ul><li>Three successful exits. </li></ul></ul><ul><ul><li>One total loss. </li></ul></ul><ul><ul><li>3% Realized Portfolio IRR. </li></ul></ul><ul><li>Active Investments (6): </li></ul><ul><ul><li>One good performer to exit within the next year. </li></ul></ul><ul><ul><li>Three anticipated total losses. </li></ul></ul><ul><ul><li>One BIG success and one recent investment. </li></ul></ul><ul><li>Total Gross Portfolio IRR of approximately 32%. </li></ul>Investment Activities Performance
    12. 12. Investment Activities Investment Criteria <ul><li>Attractive Valuation & Investment Structure </li></ul><ul><li>Multiple Exit Alternatives </li></ul>Financial Considerations <ul><li>High Growth Markets </li></ul><ul><li>Favorable Competitive Scenario </li></ul><ul><li>Proprietary Product or Service </li></ul><ul><li>Price/Performance Advantages </li></ul>Business Opportunity <ul><li>Industry Experience </li></ul><ul><li>Track Record </li></ul><ul><li>Strong Credentials & References </li></ul>Management Strength
    13. 13. Investment Activities Case Study – BTB Corporation <ul><li>Project Description: 3 managers with more than 40 years of combined experience with a multinational company in the oil industry (Bitumen). </li></ul><ul><li>Business Case: Duopoly in the marketplace, customers looking for additional option. </li></ul><ul><li>Financing: $4.2 million; $1.35 million by PREF. </li></ul><ul><li>Result: Acquired with 30% IRR to investors; Multinational closed operations. </li></ul><ul><li>Keys to Success: Management experience, customer service focus, flexibility. </li></ul>
    14. 14. Investment Activities Case Study – Rocket Learning <ul><li>Project Description: Start up provider of supplemental educational services to public school students. Highly qualified management team with start up experience. </li></ul><ul><li>Business Case: Nascent industry with “Mom and Pop” operators and no dominant player. </li></ul><ul><li>Financing: $7.7 million; $1.5 million by PREF. </li></ul><ul><li>Result: Successful service provider in PR, Florida and California. </li></ul><ul><li>Keys to Success: High quality standards, resource utilization, drive to create value. </li></ul>
    15. 15. Investment Activities Case Study – Pronatura <ul><li>Project Description: Corporate divestiture of recycling operation not considered a core competency. </li></ul><ul><li>Business Case: Industry with one major player and a number of smaller operators. Attractive industry growth opportunities. </li></ul><ul><li>Financing: $3.5 million; $1.5 million by PREF. </li></ul><ul><li>Result: Profitable operation with good growth prospects. </li></ul><ul><li>Keys to Success: Elimination of “excess fat”, focus, change in market forces. </li></ul>
    16. 16. <ul><li>Investments for Competitiveness </li></ul>
    17. 17. <ul><li>Company Owner: </li></ul><ul><ul><li>Plant expansion or modernization </li></ul></ul><ul><ul><li>Product and market expansions </li></ul></ul><ul><ul><li>Strategic acquisitions </li></ul></ul><ul><ul><li>Company divestiture </li></ul></ul><ul><ul><li>Buyout of partners or family members </li></ul></ul><ul><li>Company Manager: </li></ul><ul><ul><li>Management Buyout </li></ul></ul><ul><ul><li>Acquisition of another company </li></ul></ul><ul><ul><li>Start up within industry </li></ul></ul><ul><ul><li>Start up within management skill set </li></ul></ul>Investments for Competitiveness What can we do?
    18. 18. <ul><li>Negotiation: </li></ul><ul><ul><li>Purchase price and structure </li></ul></ul><ul><ul><li>Legal documentation </li></ul></ul><ul><li>Financing: </li></ul><ul><ul><li>Additional equity sources </li></ul></ul><ul><ul><li>Bank financing </li></ul></ul><ul><ul><li>Seller financing </li></ul></ul><ul><li>Growth Strategy: </li></ul><ul><ul><li>Financial analysis </li></ul></ul><ul><li>Exit Strategy: </li></ul><ul><ul><li>Identify and negotiate with potential acquirers </li></ul></ul>Investments for Competitiveness How will we help?
    19. 19. <ul><li>We are slow and thorough in our analysis. </li></ul><ul><li>We are more selective. </li></ul><ul><li>We want you to share the risk. </li></ul><ul><li>We require corporate governance and reporting. </li></ul><ul><li>We require an exit. </li></ul><ul><li>But, </li></ul><ul><ul><li>WE HAVE A LOT OF MONEY TO INVEST!!! </li></ul></ul>Investments for Competitiveness Words of Warning…
    20. 20. Puerto Rico Entrepreneurs Fund, L.P. “ Partnering with Entrepreneurs to Build Value” Union Plaza, Suite 1500 416 Ponce de Le ó n Avenue San Juan, Puerto Rico 00918 T: 787-620-0062 F: 787-620-0131 www.miraderocapital.com
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