Card, mobile credential, payment and security
This month campus card provider, The CBORD Group, announced a “recapitalization” that brings a “significant,” though not disclosed amount of new funds for product and market growth efforts. According to Bruce Lane, Executive Vice President and Chief Operating Officer, “we identified a opportunity for CBORD to grow faster through a combination of internal growth and external acquisitions to make us a better and larger player in the market.”
For the campus card industry, the company is already an established leader. It is also a major player in its other key market, food services and production. Across both of these markets they claim more than 700 clients including colleges and universities, corporations, and healthcare institutions. According to Mr. Lane, sales volumes are split almost equally between the two market segments. More than 280 employees work for the Ithica NY-based company founded in 1975. Though actual revenues are not disclosed, this year the company is projected to approach $40 million in sales.
For nearly 30 years, the company has been very closely held with its three founders maintaining complete ownership. That situation changed with the recapitalization adding new owners including two named investment organizations, Oak Investment Partners and Sterling Investment Partners, L.P. According to Mr. Lane, other parties did participate in the recapitalization though none were named. The three founders/owners–John Alexander, Tim Tighe, and Bruce Lane–remain owners though at obviously diminished percentages.
Specifics or terms of the transaction were not made public and company representatives declined to provide any details regarding the dollar value other than to say that the investment amounts were “significant.”
When asked what intrigued the investment partners, Mr. Lane suggested that it was CBORD’s long history of strong financial stability, management, and customer base. “CBORD is the only company in the market that has provided increasing sales and profitability year after year,” he said. “We just completed a record year for sales and profitability,” and, he adds, “we have been profitable for 25 years and are averaging 20-25% annual growth.”
So what will the company do with the new capital? Mr. Lane suggested several areas: 1. increase the product portfolio through internal development efforts, 2. increase the market reach by adding personnel in the field, and 3. increase product and reach through targeted acquisitions.
The recapitalization has also brought some changes in the management structure. Mr. Alexander, founder and former CEO, will now serve as Chairman of the Board. Tim Tighe, formerly head of the food management division, will now serve as President and CEO. Bruce Lane, head of campus card operations division, will serve as Executive Vice President and Chief Operating Officer. Will McCarthy is promoted to Vice President for Transaction Processing Systems.
When asked if the new ownership change the nature of the company or the way it approaches the market. Mr. Lane had this to say. “Regardless of your shareholders or bosses, in the end all companies have to perform. For us the pride part is that we have been consistently profitable, offered employees a good place to work, (and) provided customers with a steady stream of new products at a competitive price. This transaction gives us more horsepower and a slightly different tilt to our philosophy of growth.”
Additional resources:
To read the press release announcing the recapitalization, click here
