Capital Factors Gets Acquired Again
Perry Capital LLC agreed to acquire Capital Factors Inc., the factoring business and its assets, from Regions Financial Corp. in a deal that continued the consolidation in the industry. It also marked the return of Andrew Tananbaum to the head of a factoring company. Terms of the deal were not disclosed.
Perry Capital, a New York–based investment management firm that manages $11 billion in funds on behalf of institutions and high-net-worth individuals, partnered with Tananbaum in the venture.
Tananbaum, who will become chief executive officer of Capital Factors LLC and will be based in New York, began working in the factoring business in 1982, when his family owned Century Business Credit. Tananbaum took Century Business private in 1987 and said he sold it to Wells Fargo & Co. in 1998. The factoring organization was then renamed Wells Fargo Century.
As the nation’s fifth-largest factoring company, Capital Factors handles more than $3 billion in annual volume with the apparel, textile, furnishing and home furnishing industries. The apparel industry forms the largest segment of Capital Factors’ business by volume, Tananbaum said. Capital Factors has offices in Los Angeles; New York; Charlotte, N.C.; and Fort Lauderdale and Boca Raton, Fla.
Over the years, the company has been owned by various entities, including Capital Bank, Union Planters Corp. and Regions Financial.
“As a result of many of the acquisitions and consolidation in this business, there is still an opportunity for an entrepreneurial-spirited middle-market lending platform that Capital Factors represents in several respects,” Tananbaum said. “Because of our expectations, a lot of the business in the future will be related to import factoring.”
Ori Uziel, a managing director at Perry, said the company’s various funds will have investments in Capital Factors.
Jenifer Goforth, director of investor relations at Birmingham, Ala.–based Regions, said the company sold Capital Factors because retaining it would have been inconsistent with Regions’ core strategy, which lies in banking and related services such as insurance and its brokerage division, Morgan Keegan & Co.
Regions acquired Capital Factors when it completed its purchase of Memphis, Tenn.–based Union Planters in July 2004. With the sale of Capital Factors, Goforth said, Regions will exit the factoring business. She said the deal is expected to close by the end of April. —Khanh T.L. Tran
