Rough Country Acquired by TSG Consumer Partners – What now?

TSG Consumer Partners announced that they are acquiring Rough Country on 6/29/2021. The acquisition is expected to be complete by the end of Q3 in 2021. Previously Rough Country was owned by a company called Gridiron Capital, LLC; private equity headquartered out of New Canaan, CT.

Gridiron Capital, LLC acquired Rough Country on May 30, 2017, from Audax Group; the majority shareholder since 2013 for an undisclosed amount.

How much did TSG Consumer Partners buy Rough Country for?

At this time it is unclear the amount paid to acquired Rough Country from Gridiron Capital, the transaction is expected to be completed by the end of Q3 in 2021.

How is Gridiron Capital different from TSG Consumer Partners?

Gridiron Capital is an investment firm focused more on service companies, manufactures, health care, and technology. They are invested in companies like Yellowstone landscape, Ramsey Industries, Dealer Tire, GSM Outdoors, Foundation Wellness, and more.

TSG Consumer Partners is a private equity firm focused more on consumer companies in health and beauty, health and wellness, financial, and consumer goods. They are invested in companies like Canyon, Robinhood, Spic Span, Scopley, Collision Center, Comet, Brew Dog, PowerStop, Meguiars, and more.

What is Rough Country?

Rough Country is an industry leader in a growing after-market vehicle accessories market. Rough Country was founded by Patrick and Michael Heckethorn in 1986 and the current CEO is Ken Dunn. Rough Country is known for well-priced after-market off-road upgrades and accessories with best-in-class customer support and experience.

Rough Country’s main products are:

  • Lift Kits
  • Shocks
  • Steering Accessories
  • Wheels
  • Tires
  • Lighting
  • Interior Accessories
  • Exterior Accessories
  • Drivetrain Upgrades/Accessories

How will Rough Country Change with TSG Consumer Partners new ownership?

At best this is speculation, but speculation will suffice for this purpose. To see how Rough Country will change over the coming years we will need to look at the history of TSG Consumer Partners, and how they have changed companies in the past.

TSG Consumer Partners invests in companies with revenue ranges of $100,000,000-$10,000,000,000, and an ebitda of $0-$500,000,000 with equity investments of $100,000,000-$1,000,000,000. TSG Consumer Partners invest with a long-term outlook with an average partnership duration of 5 years or more.

TSG Consumer Partners has a minority/majority stake in the following brands.

https://portfolio.tsgconsumer.com/

With the new Rough Country acquisition automotive makes up 6.89% of TSG Consumer Partners portfolio. The majority of TSG’s portfolio lays within health and beauty; highly customer-centric business models.

The closest company within TSG Consumer Partners’ portfolio is PowerStop – a leading supplier of aftermarket brake kits and components. Both Rough Country and PowerStop focus on a unique online customer experience unmatched by the competition.

TSG Consumer Partners acquired PowerStop on June 1, 2015, so quite a bit over the average holding duration for TSG.

The acquisition of another automotive company shows TSG Consumer Partners wants to make automotive a larger percentage of their portfolio.

A quick look at the way back machine you can see how PowerStop’s website looked before the acquisition in 2014.

PowerStop.com

Now a snapshot of what PowerStop’s website looks like today.

PowerStop.com

 It is clear to see the great user experience changes TSG Consumer partners has made since the acquisition of PowerStop in 2015. The similarities between Rough Country’s website and PowerStops website are equally as clear.

RoughCountry,com

All things considered, I believe Rough Country is a long-term hold for TSG Consumer Partners. Rough County keys right into TSG’s current strategies. Little changes or no changes will need to be made to Rough Country’s user experience since they have been the industry leader for many years.

The outlook for Rough Country is strong. Offroad as an industry continues to grow year after year – and fresh eyes will improve Rough Country as a company.

Over the next years, we should see little changes overall as to Rough Country’s product offerings, quality, customer service, technical support, or user experience.

How much revenue does Rough Country make?

While Rough Country is privately held, some information can be found online regarding their revenue and employees.

$169,000,000 Yearly Revenue 

264 Employees 

Who is Rough Country’s competition?

The company that resembles Rough Country’s strategies is Zone Offroad; owned by Sport Truck USA. Zone Offroad is manufactured by BDS Suspension who is also owned by Sport Truck USA. Zone Offroad was founded as middle-market lift kit manufacture focused on a user experience and inexpensive upgrades just like Rough Country.

How big is the off-road market?

The off-road market was valued at $14,000,000,000 (fourteen billion dollars) in 2020 and is expected to grow by 25% by the end of 2021 to around $18,000,000,000 (eighteen billion dollars)

https://www.mordorintelligence.com/industry-reports/off-road-vehicle-market#:~:text=Market%20Overview,period%20(2021%2D2026).

https://www.tsgconsumer.com/news/tsg-consumer-partners-to-acquire-rough-country-from-gridiron-capital

https://gridironcapital.com/

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