$100M Equity Investment Anchors Acquisition of Au Bon Pain

Boston-based Au Bon Pain, a bakery-café chain with 226 stores, has agreed to a buyout by Au Bon Pain management and LNK Partners, a private equity firm based in White Plains, N.Y. LNK will put more than $100 million of equity in the company. The LNK capital infusion will support an expansion strategy in the U.S. and selected global markets. “Au Bon Pain has a substantial growth opportunity,” Henry Nasella, a founding partner of LNK, told CPN today. “This year they plan to open a number of new locations domestically and internationally. We will help support that growth.”LNK focuses on consumer and retail private equity opportunities. LNK deals typically range from $20 million to $150 million, which is considered the middle market, continued Nasella. Over the years, LNK has invested in companies such as Calvin Klein, Denny’s, Goody’s, Life Time Fitness, Modell’s Sporting Goods, Panera Bread Company, Spyder Active Sports, and Staples.According to Nasella, liquidity problems in the capital markets have slowed but certainly not stopped low-leverage middle market deals. “While we read every day about how the credit crunch is restricting deals, fundamentally sound businesses with proven consumer value propositions, profits, and good management continue to attract equity sponsors like us,” he added.Au Bon Pain serves breakfast, lunch, and light fare such as bread, pastries, salads, soups sandwiches and coffee. The company generated $300 million in revenues during 2007 and has delivered 33 consecutive quarters of positive comparable store growth.The company operates 121 company owned stores located primarily in Boston, Chicago, New York, Philadelphia, Pittsburgh, and Washington, D.C. Sixty-one franchised cafes operate in 20 states in the U.S., with another 44 franchises operating internationally including 34 in Thailand. CapitalSource, Au Bon Pain’s lender, will provide the debt financing for the transaction, and Intermediate Capital Group will supply junior debt.