Imperial Dade: A Private Equity Growth Story

Key Takeaways: 

  • Imperial Dade is a growth-focused company that has achieved success by systematically executing its strategy in partnership with multiple private equity groups. 
  • Over time, its management team built a platform with the scale and density needed to create new operational opportunities and offer an unrivaled breadth of products, solutions, and service. 
  • Imperial Dade is well positioned to embark on its next phase of growth in partnership with Bain Capital and Advent International. 

Imperial Dade has achieved significant growth organically and via acquisition, evolving into a world-class specialty distribution business and leader in its industry. It represents a success story for its multiple private equity partners over the years, exemplifying the value-creation and growth private equity can help unlock. 

Imperial Dade's story also highlights the importance of pursuing a long-term growth strategy that enables successive levels of value creation. Here, Harris Williams senior bankers discuss the details of this compelling journey. 

Evolution of a Leader

In 2017, Harris Williams advised Dade Paper on its sale to Imperial Bag & Paper, which at the time had partnered with Audax Private Equity to help drive its growth. This transaction united two of the industry’s largest players to form Imperial Dade, establishing the company as the clear leader in its industry. In 2019, Harris Williams advised Imperial Dade on its sale from Audax Private Equity to Bain Capital Private Equity LP. Most recently, Harris Williams once again partnered with Imperial Dade in 2022, this time advising the company on its investment from Advent International and funds managed by Bain Capital.  

“It has been incredible to watch the Imperial Dade team’s success over the last five years through multiple transactions,” says Bob Baltimore, a managing director in the Harris Williams Specialty Distribution Group. “Imperial Dade is a great example of a growth-focused company that has systematically executed its strategy.” 

Imperial Dade operates as a critical link in the foodservice packaging and janitorial supplies supply chain, connecting hundreds of suppliers with tens of thousands of customers. With each of its private equity partners, Imperial Dade’s management team has executed with discipline to reach its next phase of growth. It has remained committed to creating long-term value, executing the necessary near- to medium-term actions to realize that potential. By doing so, it established the foundation for sustained long-run growth, all while ensuring alignment with its private equity partners and their investment horizons. 

Building the Foundation

With the help of Audax, Imperial Dade laid the foundation for its long-term vision. According to Graham Gillam, a Specialty Distribution Group director, in partnership with Audax, Imperial Dade aggressively used M&A to gain scale. “Prior to Imperial Bag & Paper beginning its acquisition strategy, the industry had not seen meaningful consolidation and long existed without any national or super-regional players,” says Gillam. “Bob and Jason Tillis saw the opportunity and had a clear vision of what could be achieved commercially, operationally, and financially by consolidating the industry and creating a national player. They also knew that long-run vision was contingent on quickly building the largest network and establishing the company as the clear acquiror of choice.” 

In Baltimore’s view, Audax was the perfect partner for the company during this phase of its growth: “Imperial Dade needed to get more dots on the map quickly. It could then focus on long-term optimization, unlocking the commercial potential, operational efficiencies, and financial benefits of its scale.” Baltimore adds that Audax had the skillset and experience to help Imperial Dade execute these plans and lay the foundation for future growth. 

Gillam notes that the building blocks established during this early phase of the company’s growth were important for its next phase of growth and value creation. “Imperial Dade’s leadership had a clear view of the opportunity ahead. Rapidly scaling through acquisitions to build a national presence was a step toward transforming what a business in this industry could realize in growth potential and financial profile.” 

Focusing on Scale & Density

Imperial Dade’s management team focused on building a platform that could offer an unrivaled breadth of products, solutions, and service, setting a new standard for excellence in the sector. “This focus was critical in establishing the ‘flywheel effect’, where scale enables better customer and supplier service which drives greater commercial success. This creates a platform that others in the industry want to join through acquisition or by joining a winning team with an exceptional culture,” Gillam says. “That ‘flywheel effect’ is the hallmark of true industry leaders that can sustain long-run, above-market growth. It is the culmination of decisions made day-in and day-out that prioritize doing the right thing for customers, suppliers, and employees.” 

Rob Devlin, a vice president in the Harris Williams Specialty Distribution Group, says the company’s scale and density also unleashed an array of operational opportunities that would help it redefine what is financially possible in the industry. “Imperial Dade was focused on getting the business to the scale, footprint, and density needed to create new operational opportunities. Those were opportunities the team always knew were possible. The team also knew that achieving them was predicated on successfully executing the initial strategic transformation and scaling of the platform. As the company’s advisor, it was our job to credibly communicate that intentional evolution of the story and the largely untapped opportunity it represented,” he says. 

Unlocking New Value-Creation Opportunities

The subsequent sale of the company to Bain was the result of a collaborative effort to find a partner that could enable Imperial Dade to continue executing its strategic vision and realize the next set of value-creation opportunities. “Imperial Dade identified its short and medium-term next steps toward its vision and, in partnership with Bain, executed brilliantly,” says Baltimore. “Under Bain’s ownership, Imperial Dade tripled its revenue, significantly expanded margins, nearly doubled its customer base, and more than doubled its footprint, completing 25 acquisitions in three years.” 

“When you get a partner that shares your vision, sees the opportunity, and enables you to accelerate into those opportunities, it is very compelling,” says Brian Lucas, a managing director in the Harris Williams Specialty Distribution Group. “Bain was the right partner for this company at this inflection point in its life. The Bain team challenged Imperial Dade, was measured in where it applied resources, and brought the power of the Bain platform, including deep experience and cross-functional resources to help the company execute its objectives.” 

In partnership with Bain, Imperial Dade undertook a range of strategic initiatives to establish a world-class platform, including: 

Investing in team and operating structure – Imperial Dade put the right team in place and developed deep operational expertise. The company bolstered its senior leadership team with experienced world-class executives at the corporate and regional level.  

Driving operations to the next level of sophistication – The company built out enterprise-wide capabilities in key areas, including sourcing, sales, and pricing. Imperial Dade evolved its pricing function, developing sophisticated national capabilities that enable it to drive best practices across legacy and acquired operations. The company also made significant ongoing investments in technology, drove rigor around data collection and analytics, and established key performance indicators and best practices across facilities to ensure a consistent focus on results.  

Optimizing a national network – Imperial Dade has continuously demonstrated the ability to unlock operating leverage from acquired businesses. It also began its network and optimization strategy that will continue to yield substantial operating advantages.

What’s Ahead

Imperial Dade is well positioned to embark on its next phase of growth in partnership with Bain Capital and Advent International. Gillam points out that, through disciplined execution, the business has expanded its avenues to win. “The company continues to execute on the short-term steps to grow the business and drive operating efficiencies, yet always stays aligned with its longer-term playbook. It remains focused on delivering exceptional results and service for its customers, suppliers and employees, that will ensure years of continued growth and success for both the Imperial Dade team and its investor partners.”  

Baltimore summarizes the important role of Imperial Dade’s private equity partnerships: “Audax helped management build the foundation and capitalize on first-mover advantage. The execution of this strategy then enabled Bain and management to further accelerate its growth and begin pursuing scale-based advantages. Advent and Bain can now capitalize on this and continue to scale the business. They can execute against the exciting commercial and acquisition opportunities ahead, as well as the variety of efficiency and margin-enhancing projects that will unlock yet more value, drive even greater customer service, and further cement Imperial Dade’s leadership position in North America.”  

“Sponsors want to see that a company has a vision for what it can do in the long term and how it can add new value creation levers over time, many of which are enabled by scale,” adds Lucas. “They also want to know that the company can execute against a plan. The Imperial Dade team has consistently delivered on this promise.” 

The business services landscape is fast-moving, dynamic, and diverse, and serves a rich variety of end markets. Our Business Services Group, led by senior professionals with extensive industry experience, partners with investors and high-growth companies worldwide to help them navigate the M&A market and unlock value in their businesses. 

We have a longstanding track record of working with companies across subsectors within the professional services, commercial and industrial services, and specialty distribution segments.

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