The funding backing the merger of Murray Feiss Imports and Sea Gull Lighting was expected to wrap up last week. Bear Stearns is leading the five-year, $20 million revolver; six-year, $125 million first-lien term loan; and seven-year, $40 million second-lien term loan for Quality Home Brands, a newly formed holding company in which Quad-C Management, Murray Feiss and Sea Gull all have ownership interests. Pricing on the revolver and first lien is LIBOR plus 3% and pricing on the second lien is LIBOR plus 6 1/2%. Murray Feiss became a portfolio company of Quad-C in 2004.
Following the acquisition, Sea Gull and Murray Feiss will form one of the largest private lighting companies in North America. The companies will continue to operate under their separate names, according to Ron Hersh, president of administration at Murray Feiss. The two groups will, however, take advantage of efficiency in the back office, especially on the sourcing and manufacturing side.
Hersh does not remember whether Murray Feiss approached Sea Gull or vice versa, but explained that when it partnered with Quad-C, the private equity group asked for a wish list of what companies Murray Feiss would be interested in partnering with and Sea Gull was at the top of that list. At the same time, Sea Gull was in the process of working with Bear Stearns, also looking for a merger partner. "We have known each other for decades and had a mutual respect," Hersh said. "By combining the two companies, this is one of the few cases, and I've heard this echoed with our customers, this looks like one plus one equals three because there are so many things they do well in areas we don't touch and vice versa."
With the combined company, Hersh thinks the group will be in a good position for other potential acquisitions, though he stressed this would not be in the near future. "We think it will be a very attractive entity to bring in other related companies, which have yet to be discussed, but we truly think this is going to be a great looking company to anyone on the outside," he said.
Quad-C declined comment. A spokeswoman for Sea Gull did not return a call.