Acquisitions in the party rental business have hit a dizzying pace this month, as interest in this sector grows in the financial world.
On Monday, Los Angeles-based party rental leader Classic Party Rentals announced its acquisition of Memphis-based Grand Events & Party Rentals. With a second outlet in Nashville, Tenn., Grand pulls in an estimated $11 million a year in revenue and is ranked No. 19 on the Special Events Magazine "30 Top Event Rental Companies" list.
Less than two weeks ago, Classic announced that it had picked up a second party rental company in Florida--West Palm Beach-based Fiesta Rentals.
Founded in 1990, Grand Events serves high-profile events including the CMT Music Video Awards, CMA Music Festival, Stanford-St. Jude PGA Golf Tournament and Freedom Awards and counts Graceland, the Tennessee Titans, Memphis Grizzlies, Nashville Super Speedway, St. Jude’s Children’s Hospital, and Music City Marathon among its clients.
“We feel very fortunate as we continue to be an important part of the events market in the mid-South, and we look forward to helping grow Classic’s presence throughout the region,” said Stan White, Grand Events founder and president. “Combining our resources ultimately means greater choices and greater resources, especially tenting, for clients in the region. Philosophically, Classic and Grand Events both care deeply about serving our customers, and we always want to be the first choice when clients think of a rental partner.”
Classic will continue to operate the business at the existing Memphis and Nashville locations, the company said in a statement, with Stan White and wife Beth continuing to lead the business. Mark White, co-founder of the Memphis operation and Stan White's brother, will stay on as a consultant.
“Classic is excited to enter the vibrant and diverse Tennessee event rental business in a big way,” John Campanelli, Classic Party Rentals CEO, said in a statement. “Gaining access to the growing Memphis, Nashville, and surrounding markets is very compelling to us.”
But the Classic story is only part of the big rental industry-buying spree.
On Friday, Salt Lake City-based Diamond Rental announced the completion of a management-led buyout. With three event rental outlets and 14 equipment rental operations, the company ranks No. 15th on the Special Events list.
And on July 12, Orlando, Fla.-based Kirby Rental Service announced that president Paul Weidner and partner Robert Picerne, who heads a real estate development company, purchased the company from longtime owner Dick Browne. With operations in Orlando, Jacksonville and Ormond Beach, Fla., and annual revenue of nearly $17 million, Kirby ranks No. 9 on the Special Events list. Mergers and acquisitions firm Hageman, Stansberry & Associates represented Kirby in the transaction.
In an interview with Special Events, Weidner said that a crucial goal in the deal was to keep existing management in place. "That was the whole goal in this endeavor," he said. "To make sure that the people who helped bring the company to where it is stay with the company. After 36 years in the special event rental industry, I'm excited that key management is on board to help lead Kirby to the next level," he added.
What's driving all the buying? "There's a lot of activity out there on the acquisitions front," HS&A partner Gary Stansberry tells Special Events. Classic itself changed hands in December, moving from Greenwich, Conn.-based Dubin Clark & Co. to Quad-C Management, a private equity firm based in Charlottesville, Va. Although the shift was initially a quiet one in the event industry, it made a big noise in the investments community. "A lot of private equity companies began looking at this industry," Stansberry says. "They see it as having good dynamics and offering good returns, but still a very fragmented industry."
Industry insiders predict the steady pace of acquisitions by Classic to continue, Special Events has learned.