PRIVATE EQUITY CONFERENCE HELD IN PROVIDENCE 
 
FOR IMMEDIATE RELEASE
CONTACT: Betty Galligan
(401) 433-5965
betty@newberrypr.com


PROVIDENCE, R.I. (July 12, 2006): Management Capital, LLC, a private equity firm serving small- and middle-market companies with leadership and capital, held its first Private Equity Conference today at the Hope Club in Providence.

Over 50 investors, investment professionals, bankers, attorneys, and accountants from New England, Chicago and New York were in attendance. The event, chaired by one of Management Capital's principals, Jerry Cerce, featured presentations by the CEOs of two of the Management Capital portfolio companies, namely Brian Urban of Sencorp, Inc. (Hyannis, MA) and Richard Paolino of White Systems, Inc. (Kenilworth, NJ).

Mr. Urban and Mr. Paolino reported in detail about their company's current and future financial, operational, investment, and marketing strategies for the benefit of the private investors in the audience. Immediately following each CEO presentation, an interactive question-and-answer session was held.

Stuart Adam, founder of the international multi-family office Adam & Partners of New York, presented “The Challenges of Private Equity Investments.” Some of the challenges he mentioned for private equity investors included over- or under-exposure, lack of transparency, lack of liquidity, higher fees than those for public securities, investment exit strategy, and quality and experience of the investment firm's managers. “It's very important to be paid for illiquidity and for the time horizon when investing in private equity,” stated Mr. Adam. “One must have access to the top managers at the equity firm and transparency is key. You must know what's going on. Furthermore, you should expect a low correlation to public markets of between .3 and .5, and a return target to provide excess returns of 6-8%, net of fees, over public markets.”

Mr. Adam, who has nearly 30 years of experience in the international private banking profession, offered real-world tips on selecting a private equity firm to work with. “One of the signs I look for is whether or not a manager has his or her own capital invested,” he added. “The total investment you make as an individual investor should not be more than 30% of the overall transaction, and consider investing only in buyouts - not ventures -- to obtain assurance that the private equity firm has control.”

Management Capital's Ernie Humphreys and Bob Manchester, principals in the firm, presented “The State of Private Equity Today.” They provided statistics on the uptick in the number (412) and value ($82 billion) of announced middle market transactions valued between $25-500 million since first quarter 2005, and the $175 billion of available, uninvested private equity capital in 2005.

In looking at the industry as a whole, the market is ripe for capital investment. “Our business will explode in the next two years,” predicted Mr. Humphreys. “We see capital structures at four times cash flow for a business. When you add subordinated debt on top of it, that's a recipe for disaster.”

Mr. Manchester noted, “We're seeing lenders becoming more aggressive with advance rates. This is driving multiples up which is great for private equity firms and entrepreneurs trying to exit a business but not so great for people looking to invest.”

All three Management Capital principals (Jerry Cerce, Ernie Humphreys and Bob Manchester) presented their unique investment criteria for branded consumer and industrial products companies with revenues of $10 to $100 million seeking to grow, acquire, expand, recapitalize, buyout, or change ownership. Their investment approach is to serve as an active, hands-on lead investor typically working closely with company management to achieve strategic objectives. If a solid management team is not in place but the ability to build one exists, Management Capital will place an interim CEO at the company until a quality team can be assembled.

“What we do is all about management and finding the right resources for a company seeking our investment,” stated Mr. Cerce. “Ideally, we look for leading companies with dominant market share, who are well-positioned to service their customers, and have a talented and committed management team. We found this in Sencorp and White Systems, and will continue to seek quality portfolio opportunities like these in the future.”


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Established in 2003, Management Capital LLC is a private equity firm providing leadership and capital to companies with revenues of $10 to $100 million. The firm provides subordinated debt and equity capital to be used for expansion, recapitalizations, acquisition support, change of ownership, or buyouts. The firm's principals work with company management to identify and execute profit improvement and growth strategies. The company is located at 10 Dorrance Street, Suite 500, Providence, RI 02903; phone: (401) 621-8200; fax: (401) 621-8202; Web: www.mgtcapital.com