Middle Market Private Equity Saves Big Name Retailers

A recent post on The New York Times DealBook blog details how middle market private equity firms can have a lasting impact, transforming struggling brands into stronger and more profitable businesses.

After experiencing dwindling sales and worried investors during the years following the financial crisis, in 2010 jewelry retailer Zale was in need of a lifeline. Rescue came in the form of an injection of growth capital from middle market private equity firm Golden Gate Capital – the same firm that recently invested in – and saved – similarly struggling outdoor clothing retailer Eddie Bauer.

As DealBook notes, “The return was achieved through the two-pronged structure of Golden Gate’s deal, in which it invested in both the debt and equity of Zale.”

Thanks to Golden Gate’s intervention, Zale and Eddie Bauer are just two examples of how private equity provides struggling companies with the capital and organizational tools they need to turn around, saving jobs and creating more valuable companies.