More on Hoffmaster

More on the Hoffmaster buy-out from the NW:

"We look at it as an opportunity for us. We can give management the support it would like to have, we can provide capital to the business to achieve better operating performance," Rohrbach said. "The organization is well-structured, but you're always looking for opportunities to structure things better. We hope to grow the business and have a need for everyone that is there and more into the future."

And a little later on,

"A private equity firm purchases businesses that are underperforming or that they feel has future potential growth," Rohrbach said. "They then support the management team to add value and growth to the business and will probably then move the business on to a new owner. I think it has performed very close to Solo's expectations, however, from our perspective, with the right kind of support it can go well beyond those levels."

This an excellent account of what a private equity company does, by the way, and is as concise a description as you'll find.

Here's some more from Crain's Chicago:

A Solo spokeswoman said Hoffmaster does not fit with Solo’s primary business of making food-service items for quick-service restaurant chains like Starbucks and McDonald’s and selling Solo-brand consumer products through big-box retailers and supermarkets.

“Hoffmaster is more about special occasions. Solo is more about everyday use,” she said. “We can’t afford to support Hoffmaster in the way they deserve.”

Mt. Kisco, N.Y.-based Kohlberg expects the Hoffman acquisition to lead to other deals for companies with related products.

“It would be a new platform investment for us,” said Jack Rohrbach, a managing principal for the firm. “We think as a focus business for us we can help the (Hoffmaster) management group with the attention they need and the capital they need to reach the potential we think exists in this business.”

That basically says that Hoffmaster didn't fit into Solo's business plan and suffered for it.