Levine Leichtman Capital Partners and Management to Acquire Shipley Do-Nuts

Levine Leichtman Capital Partners, a Los Angeles-based private equity firm with $12.7 billion in assets under management, partnered with company management to acquire Shipley Do-Nuts from Peak Rock Capital. Financial terms of the transaction were not disclosed.

Houston-based Shipley bills itself as the nation’s largest donut and kolache brand with 375 locations across 14 states that provide more than 60 varieties of handcrafted, fresh-made-daily donuts, kolaches and coffee. It was founded in 1936 and is headquartered in Houston, where it will continue to be operated by the existing management team led by Flynn Decker, chief executive.

“We see a tremendous opportunity to build on this foundation by expanding unit count even further to capture the substantial whitespace and driving strong same-store sales growth,” said Matthew Frankel, managing partner of Levine Leichtman, in a statement.

Shipley is the fourth platform investment of Levine Leichtman Capital Partners VII LP. Across its funds, the middle-market private equity firm has extensive experience investing in the franchising industry, including prior investments in Tropical Smoothie Cafe, Nothing Bundt Cakes, and Hand & Stone. Shipley represents its 18th franchising investment, with a combined 32 brands across a variety of industries.

“We are excited to leverage our extensive experience investing in the franchising space to pursue various growth initiatives alongside them,” said Greg Flaster, managing director at Levine Leichtman, in a statement.

Kirkland & Ellis LLP and DLA Piper served as legal counsel to Levine Leichtman on the transaction. Shipley was advised by North Point and J.P. Morgan.

Information for this article was sourced from Levine Leichtman Capital Partners.