Jegs Automotive acquired by private equity firm
New York-based Greenbriar Equity Group LP has acquired a majority stake in the Central Ohio-based retailer and distributor of aftermarket auto parts and accessories...
...Jegs President Jeg Coughlin III said in the release that Greenbriar will help improve the online experience for customers, bring on new products and services, and expand the business’ reach through both organic growth and mergers and acquisitions.
https://www.bizjournals.com/columbus/news/2022/02/24/jegs-acquired-by-greenbriar-equity-group.html?utm_source=st&utm_medium=en&utm_campaign=BN&utm_content=co&ana=e_co_BN&j=26820349&senddate=2022-02-24
You may or may not be able to access this article without a subscrption. There isn't much more detail in the article besides the history of the two companies. Let's see if these guys think they can run Jeg's better than the family can.
I work for a PE owned company.
We're half the staff but expected to grow 33% in 3 years. Huh, I'll be 62 years old in 3 years......
New products, ya say? I'm sure that said products weren't already on Jegs because Jegs wasn't ready to handle the superior quality of these new products. I don't know anything about Greenbriar but I've never heard anything good about PE acquisitions from someone on the acquired end.
Summit just moved up my go to list.
Tom1200
UltraDork
2/24/22 11:44 p.m.
Equity firms ruin everything.
Bleed it dry.
So long, Jeggs, we hardly knew you .
Ah yes...the good 'ol Personal Exploitation firm. Someone should label the Exit doors at Jegs...they're gonna need 'em.
Dang dang dang. Jegs is a hometown company for me and there warehouse store is on the way home from work. Guess I'll have to get un-used to it eventually.
If you ever watched The Sopranos and remember when Tony and his crew shook down the sporting goods store over some gambling debt, that's pretty much how PE operates.
Essentially they buy you out with your money.
@Datsun310Guy
No. They don't expect you to meet those numbers. That's the impossibly high bar they set for you to clear to keep them from bleeding you out. They really do not care. They will sell off your company's assets and come out in the black.
The way PE operates needs to be re-examined. And if you read the WSJ comment section with any frequency you'll find that even many political conservatives agree.
Type Q
SuperDork
2/25/22 7:57 a.m.
I am really sorry to hear this. It was nice while it lasted.
Private equity is a cancer in the US economy.
Guys.... Lets not over react.
Im sure the PE firm really likes what Jegs is doing here. They just want to bring in some synergy and take things to the next level. They are not looking to make any changes, they just want to observe the current processes and help leverage some efficiency gains. Part of the reason they took over was BECAUSE of the people so why would they want to make any changes? See. Nothing to worry about! Don't pay attention to those Jegs brand coolers when they start popping up for sale at Lowes.
I sat in a meeting once where the new boss said, "we love your company culture and don't want to change any of it."
I so wanted to ask, "can you define our culture?"
A very short time later, our culture was changed to be their culture.
When we changed over a new guy shows up and sits down with sales to introduce himself as our regional manager. He starts with this;
Guys, I not making any changes or asking for anything. This meeting is for us all to get to know each other a little bit and what our roles are here at the company, that's all.
By the end of the meeting he assigned us 3 tasks to submit back to him. I thought it was funny.
Tom1200 said:
Equity firms ruin everything.
Has any PE firm ever improved any business?
That sucks. I buy quite a bit from Jeg's.
spitfirebill said:
Tom1200 said:
Equity firms ruin everything.
Has any PE firm ever improved any business?
Yes, they are very good at helping other independent businesses grow by losing their own customers.
Just another great piece of news in the recent string of great news, I guess. Sigh.
Toyman!
MegaDork
2/25/22 10:27 a.m.
That's unfortunate.
But as long as there are business owners that want to cash out and retire, there will be PE companies to help them.
slefain
PowerDork
2/25/22 10:35 a.m.
My buddy worked at Jegs corporate and GTFO before it happened. He's happy to be gone.
The consulting firm I worked for was purchased just before covid by a PE group. I took my accounts and went on my own. They attempted to sue me for non compete, it was tossed as my non compete was signed with previous ownership, and not them. My client list tripled afterwards, all clients had previously been with my employer and the ROI for my clients is 780% than those who stayed aboard the sinking ship.
Bottom line is, if you're with Jegs now, jump ship.
Tom1200
UltraDork
2/25/22 12:11 p.m.
spitfirebill said:
Tom1200 said:
Equity firms ruin everything.
Has any PE firm ever improved any business?
I'm sure some of them have but my (albeit limited experience) says it's a wash at best.
I've been out of the Gaming (Vegas) industry for almost 15 years now but anytime a company takes on high amounts of debt in an effort to increase profits it's always skatey in my opinion...............regardless of what rates one gets on said debt.
We had the bean counters try to run the show back in the 90s; one of the first things they would attack is why hotels were giving away so much food and drink. They failed to understand that well feed drunk people gamble more.
Some things need that bit of fat. Think of it like Mortadella, those little bits of fat are what makes it what it is..............without that it kind of just becomes Bologna (the meat not the city).
Many PEs fail to recognize the recipe that made the company successful. If they're doing a pump and dump then it's no big deal.
The one aspect that I have no idea how it's legal is the debt being assigned to the company and not the PE. The PE took initiated the loan not the company they bought. To me this is where the majority of the problems come from.
