The Carlyle Group provides USD95m in transitional growth capital for Zippy Shell
The Carlyle Group's Global Credit platform has provided USD95 million in transitional growth capital for Wake Forest, North Carolina-based Zippy Shell, one of the largest containerized moving and storage companies in the United States.
The financing package includes a USD75 million second lien term loan and USD20 million in preferred equity. Zippy Shell plans to use the funds for growth initiatives and strategic acquisitions.
Alex Popov, Carlyle’s Co-Head of Illiquid Credit Strategies and Head of Carlyle’s Credit Opportunities team, says: “Zippy Shell and its subsidiary 1-800-PACK-RAT are strongly positioned for expansion in the moving and storage industry and we are pleased to provide the capital it needs to grow its fleet, enter new markets and fund acquisitions. Drawing on insights from our global investment platform, we were able to move quickly to identify and diligence the deal and provide a customised financing solution for the team.”
Mark Kuhns, Zippy Shell’s Chief Executive Officer, says: “Carlyle’s ability to see the growth potential of our business showed that they are more than just a financial partner, they are a business partner whom we’re confident will help us successfully scale our business. By providing equity in addition to debt, they have demonstrated their confidence in our team and we look forward to working with Carlyle as we meet increasing needs for simple, convenient moving and storage solutions across the country.”
Zippy Shell, founded in 2009, merged with 1-800-PACK-RAT in mid-2018 creating a national network of over 71 warehouse facilities, reaching a total addressable domestic market of 240 million consumers. The company provides an alternative to traditional temporary storage and moving options by delivering containers that are dropped off directly at a customer’s location, filled with their belongings on their schedule and then stored at a drop-off site and/or at a company location, or moved to the destination for unloading by the consumer. Zippy Shell has seen steady growth in demand for its services, in particular long-distance moves and local storage, since its combination with 1-800-PACK-RAT in 2018. 1-800-PACK-RAT was founded in 2002 in North Carolina and has seen impressive growth throughout the years in both residential and commercial markets.
Carlyle’s USD53 billion Global Credit segment made the investment with capital primarily from its Credit Opportunities Fund, a USD2.4 billion fund that closed last year. The Credit Opportunities Fund invests in privately negotiated capital solutions primarily for upper middle market borrowers, including both private equity sponsored and family or entrepreneur-owned companies. The Credit Opportunities Fund seeks to benefit from proprietary investment opportunities originating from within Carlyle and the firm’s global resources and operating expertise.