The keys to a successful transaction with ACP are: 1. Establishing strong aligned interest with a competent GP; 2. Identifying assets which meet ACP's investment criteria; 3. Devising a structured price matrix that is fair and meets expectations of the GP, its LPs and ACP's investors.

• Portfolio Assets from 2000-2005 vintage year funds
• Revenue of $100MM or greater and EBITDA of $10MM or greater
• Free Cash Flow to be a minimum of 5% of total revenue
• Less than 2.5X net debt to EBITDA ratio (post transaction)
• 16 quarter positive trend of EBITDA growth
• Reasonable incentive structure for company management
• Company not in a highly cyclical industry
• Minimum of 5 portfolio companies in transaction
• A diversified pool of assets within diversified sectors and industries

ACP aims to acquire stakes in portfolio companies which are growing, healthy, and non-cyclical. ACP may recalibrate the capital structure in the portfolio companies through a mix of primary and secondary equity in the transaction.  For example, if a company meets all criteria but is over laden with debt, ACP may apply capital to pare back the debt load, thus improving the debt/EBITDA ratio and impacting positively free cash flow.

Each transaction size varies, but typically ACP looks to fund transactions between $100MM and $500MM.  ACP finds that such transactions work best when there is a meaningful amount of liquidity to be generated for the benefit of both the GP and its LPs.

The diligence process for the transaction is typically "lighter" than traditional M&A.  The process begins by targeting the high probability portfolio assets.  ACP will request historical financials (5 years), all legal documents surrounding initial investments and follow-on investments, any "tag and drag" rights, all banking/debt covenants and contemporaneous flash reports from each portfolio company.

ACP reviews the diligence materials immediately (10-20 days).  This includes a collaborative dialogue with the GP and, when necessary, company management.  The seller and Accretive discuss and agree on general deal terms at the conclusion of the diligence period.  Then move towards closing from a handshake agreement on general terms and valuations (30-45 days).  Accretive is committing to the selling GP as much as it is investing in the underlying assets.  Therefore, it is important that the diligence and negotiations between the two parties demonstrate an ability to work together effectively, establish trust and reflect mutual respect. ACP assesses quickly the potential for closing a deal expeditiously after the initial review.  Thus, if ACP begins to engage in full diligence and can reach initial agreement on valuations with a seller, there is near certainty of closing on a transaction.  ACP has funding commitments from a select group of large, global institutional PE investors and secondary PE sponsors.

Accretive Capital was founded in 2007 by Edwin Wang, who brings over 20 years of private equity and cross border investment experience, formerly of Credit Suisse and Lehman Brothers; Andrew Reilly, previously of Fondinvest Capital and a Board Member and Chair of the Alternative Investments Sub-Committee for the Rhode Island State Investment Commission, which has oversight of the $8B RI State Employees Pension System; and Theodore Tedeschi who brings over twenty years of legal and M&A transaction experience to the firm.  Accretive's investment team has over fifty years of combined private equity experience and draws on complementary skill sets to achieve the firm's goal of delivering the highest returns to its investors from the highest quality secondary direct transactions in middle market private equity.