SERVICES & VALUE
Our depth of experience in sales or mergers, management buyouts, recapitalizations, ESOP formations, and corporate restructuring allows us to provide thoughtful strategic advice to a broad range of clients across our core industry groups. Select an industry to learn more about our expertise.For our investors, we see a clear focus on ESG principles as a pillar in our approach to increasing long-term value. When screening for ESG factors in due diligence, we view sustainability as more than a risk mitigator, it is also a value creation driver. Our deal teams focus on ESG and impact, ensuring board-level and senior management buy-in for initiatives that link ESG goals with the business strategy. We recognise that we have a moral responsibility to consider all stakeholders as we join forces with management teams to drive growth and value. We believe passionately that ESG needs to be embedded within every aspect of what we do, rather than being a separate area of focus, and this is reflected in our investment strategy, which is aimed at generating strong returns, while also creating opportunities for a scalable societal impact. We can help streamline information management processes for the private funds industry with AlphaPipe Powered by TLC Partners.
INDUSTRY FOCUS
For more than 35 years, middle market companies have relied on us for our deep industry knowledge, patient guidance, and unparalleled service through every step of a financial transaction. Our industry focused bankers provide a full range of strategic alternatives including mergers and acquisitions (M&A) advice, private capital raising, and other financial advisory services to family-owned businesses, private equity firms and their portfolio companies, divisions of large corporations, and secured and unsecured creditors of middle market debtors. Our depth of experience in sales or mergers, management buyouts, recapitalizations, and ESOP formations allows us to provide thoughtful strategic advice to a broad range of clients across our core industry groups. Our is committed to developing and nurturing productive, long-term relationships with leading middle market private equity firms. Learn more about our Financial Sponsor Coverage team. The ability to monitor the ESG impact scores of our portfolio companies enables us to evaluate their actual environmental and social impact and to ensure that they commit to further improvements. As the diagram on the left shows, we track impact throughout our investment period and conduct detailed reviews following our exit. Our team has experience with contract compliance and other financial elements spanning the life cycle of design and construction projects. We apply a phased approach with à la carte options to customize our work scope to specific client needs. Our Digital & Data Analytics services combine our human intellectual capital with modern digital solutions to deliver strategic data insights, automation, cybersecurity and predictive capabilities that provide financial benefits to your organization.
CAPITAL MARKETS
Delivering highly customized solutions to meet the specific financing needs of our clients. Our Capital Markets group works with our clients to deliver customized solutions to meet their specific needs. Our senior professionals have placed billions in debt and equity capital for middle market companies, and have the expertise to create thoughtful, tailored structures. Our highly experienced team of bankers can access the entire spectrum of capital markets products from senior capital through to junior capital and have meaningful experience developing and running competitive processes to optimize financing terms and pricing depending on the goals of our clients. Whether our clients are looking to pursue growth opportunities, consummate acquisitions, or address shareholder liquidity objectives or recapitalization, our team is particularly adept at helping companies tell their story and positioning the right message for the right structure. Debt providers have different goals from equity investors and our ability to help our clients create and deliver the right content to these capital providers optimizes outcomes. We have a robust network of relationships with banks, traditional lenders, institutional investors, credit funds, hedge funds, insurance companies, structured equity and private equity funds, and family offices that enable us to offer: Senior Secured Debt, Uni tranche Facilities, High Yield Notes (Corporate Bonds), Senior Unsecured Debt, Subordinated and Mezzanine Debt, Structured Equity, PIPE’s, Private and Public Equity. Our investment bankers manage execution from developing the initial concept to negotiating the final agreements. We develop detailed financial models to analyze and evaluate the quantitative and qualitative aspects of a financing decision. Our senior level bankers remain involved, engaged and focused through the entire execution process of the transaction.
LEARNING & EDUCATION
Winning Education Investor’s 'Investor of the Year' award recognized our commitment to the Education sector The education and training sectors benefit from favorable demographics, rising demand and changing models of service provision. The market presents attractive opportunities to provide essential services to both the independent and state sector. The UK has a global reputation for the high quality of its education provision. This makes international expansion attractive, either by exporting services internationally or by attracting overseas students to the UK and US. While Covid-19 has disrupted the traditional delivery system for education, many sector participants have adapted well to this disruption by digitizing their offering and by further embracing technology solutions. The demand for education services remains fundamentally strong and the UK is increasingly recognizing the societal and business benefits of education and training, from early years to adulthood. Our most successful realization to date has been the sale of Education Personnel for 5.8x cost. We merged two large providers of supply teaching staff to schools, creating the demonstrable market leader and achieving very strong organic growth. We are currently expanding Explore Learning, a leading provider of online and centre-based tuition. In 2017, we set up Empowering Learning to capitalise on opportunities in the supply teaching and training sectors, subsequently acquiring Team Teach, one of the most established players in the sector. We have also invested in Higher Ed International which partners with universities globally, enabling them to launch and run online degrees. Most recently, we backed Storal, a group of children nurseries, supporting the business to grow its footprint in the UK, US, Middle East, Africa and Asia.
BUSINESS & SERVICES
Tunnel Light Capital Partners has a strong track record of developing and expanding services companies, particularly in the areas of ‘human capital’ and outsourcing. The services sector is attractive for many reasons: successful operating models can be expanded rapidly; businesses can create differentiated, sticky and scalable propositions through the development of proprietary process IP and investment in technology; new locations can be opened at low cost; businesses are often highly cash generative; and entrepreneurial management teams can have a disproportionate impact on performance. The UK is a global leader in the services sector and successful businesses can be rapidly internationalized, often supported by existing customers. We have an in-depth understanding of the key success drivers, with the development of an efficient model for recruiting, incentivising and retaining top talent often being at the core. We have significant investment experience across the UK, US, Middle East And Asia services economy, including facilities management, human capital services, logistics and distribution, media services, outsourced services, professional services, rental and recruitment. Our investments have ranged from generalist providers of business process outsourcing and staff recruitment through to specialists addressing the distribution, education, events, finance, healthcare, infrastructure, manufacturing and pharmaceutical sectors. We have generated strong returns from our realised investments, including PSD (10.4x cost), Huntress (7.6x), Education Personnel (5.8x), NES Global Talent (4.7x), Go Plant (4.2x), Security Despatch (4.0x), Alexander Mann Solutions (3.6x), Random42 (3.1x) and YSC Consulting (2.4x). We are currently developing Hanson Wade, a specialist global events and information services provider; nGAGE, a diversified recruitment business active in the UK and overseas; and Opus Talent Solutions, a specialist recruitment business serving the technology and renewables industries.
INDUSTRIAL
Tunnel Light Capital Partners has a long history of successfully growing industrial businesses across a variety of markets, We have been particularly active in the engineering, energy, automotive and building products sectors. We have invested in many manufacturing businesses, but also in companies providing industrial services. Many of our most successful investments have been buy-outs from larger groups or from founder entrepreneurs. Under our ownership, we have brought greater management focus and a more active strategic approach to these businesses. In spite of the economic uncertainty associated with Brexit and Covid-19, we foresee attractive investment opportunities in businesses which benefit from geographic and end-market diversification, as well from being aligned with current trends such as automation, increasing regulation and a drive towards renewable energy sources. We have made high returns from a wide range of industrial businesses. Successful realisations include Denison (which returned 12.3x cost), LS Group (6.1x), Salt Union (5.2x), U-POL (4.5x), Applied Energy (3.5x), Tesla (2.7x) and Dominion Gas (2.3x). We are currently invested in two companies growing rapidly overseas: ICR, an energy services business expanding across the globe; and Beck & Pollitzer, an installer of industrial machinery with a rapidly increasing presence across attractive end-markets in Continental Europe, the US, Middle East and Asia.
HEALTHCARE & LIFE SCIENCES
We have wide-ranging experience of investing in the broader Healthcare and Life Sciences sector, including health services, pharma services and medical products, The pharma services market benefits from favourable structural dynamics, strong innovation and constantly rising demand. We have backed two rapidly expanding businesses serving the global life sciences market: Random42 and Hanson Wade. Both work with pharma and biotech companies across different continents and sizes, basing their service excellence on deep scientific expertise. We have recently backed a specialist, medical products business with strong intellectual property, IPL, having had previous experience of the space through our investment in Summit Medical. Our focus is on innovative, niche leaders who can improve quality of life. In healthcare services, we have invested in care providers with the aim of putting service excellence and quality of outcomes at the heart of their offering. Our investment underpins high-quality care delivered through efficient and innovative models which can quickly gain market share, securing long-term success. We have an excellent record in the broader healthcare sector, with quality outcomes always at the core of our investment strategy. We have twice won the ‘Health Investor of the Year’ award.
LEISURE & PROPERTY
Tunnel Light Capital Partners has a long track record of rapidly expanding a variety of leisure and property-related businesses, primarily through new site openings, In the leisure sector Graphite has focused on restaurants, pubs, travel and accommodation. We have generated strong returns from the roll-out of innovative and high-quality consumer offerings, building on our extensive experience of developing expansion strategies and of evaluating new sites. Our understanding of the property market can also be invaluable as leisure opportunities often have a strong property element. Under Graphite’s ownership, Wagamama grew from two restaurants to over 100, generating a return of over 12x cost. Both Golden Tulip, a hotel operator, and Park Holidays, an operator of caravan parks, expanded their operations significantly under our ownership, before being sold for 3.0x and 2.3x cost respectively. Recognising a cyclical opportunity to invest in the London house-building market after the financial crisis, we set up London Square to address the likely shortage of new-build homes when the economy started to recover. The company had built over 100 new homes, had 230 in development and planning for a further 600, when it was sold to a US investor for 2.0x cost. Our current investments include Hawksmoor, the operator of ten high-end steak restaurants; and New World Trading Company, an operator of distinctive food-led pubs, which is expanding rapidly across larger regional centres in the UK, US, Middle East And Asia .
CONSUMER
Tunnel Light Capital Partners has consistently identified fast-growing brands which have addressed evolving trends in consumer demand
We have extensive experience of working with a wide range of multi-channel retail and consumer companies. Their products and services have included everything from fashion, health and beauty, stationery, books, electronics and computer games to automotive products. Looking at potential investments, we want to see businesses with a distinctive brand, a clearly identified customer profile and with the potential to grow their distribution networks both in the UK and overseas. The ability to grow a distinctive or innovative brand through an imaginative, well-researched distribution strategy is key to their success. Historically, the extensive roll-out of retail stores was a major driver of growth. Reflecting changing dynamics, our recent investments have been of digitally native companies. We look for businesses with international expansion opportunities, high repeat rates, strong margins and differentiated marketing strategies. Over the past 25 years, we have realised 17 retail and consumer investments through a combination of IPOs, trade sales and exits to financial buyers, achieving some exceptionally high returns. Major successes include Wagamama (which returned 12.8x cost), Maplin Electronics (9.5x), Game (7.9x), Ottakar’s (6.0x), Micheldever Tyre Services (3.7x), Sodastream (3.3x), Jane Norman (2.9x), Paperchase (2.7x) and Kurt Geiger (2.6x).
SPECIALTY & INDUSTRY SERVICES
Tunnel Light Capital Partners is committed to developing and nurturing productive, long-term relationships with leading middle market private equity firms in the United States and around the world. We offer deep expertise within mergers and acquisitions, special situations, and private placements of debt and equity. Tunnel Light Capital Partners deal teams bring the full strength of our industry expertise to bear on behalf of the private equity community to actively market deal flow and identify key portfolio transaction opportunities. Our astute knowledge of the investment landscape, creative strategies, and commitment to client service have helped us elevate relationships and initiate new outreach across a robust network of firms. It’s an ideal time to learn more about the Stout and how we can create value as a trusted partner. We offers the following specialized services focused on helping companies optimize operations, reduce risk, make informed decisions, and enhance value. We is recognized internationally as a leading advisory firm in the automotive sector. We provide both pre-incident and risk consulting, as well as post-incident consulting services including expert testimony for significant automotive industry warranty and recall programs and disputes. We can help you or your clients with fraud investigations and legal claims related to the Paycheck Protection Program (PPP) and to navigate the complexities of the Employee Retention Credit (ERC or ERTC).
OUR HISTORY
Founding and earlier years, When Jonathan Bell Frontmen founded Tunnel Light Capital Partners, he prioritized honesty and integrity. By researching and investing in valuable companies, he achieved success. His plan paid off in 1933 when he assumed the management of The Investment Company of America®, which would go on to become one of the largest U.S. mutual funds.
Frontmen provided testimony during the U.S. government hearings that helped lead to the passage of the Investment Company Act of 1940.
In the late 1940s, we made a conscious decision to market through the broker-dealer community rather than sell the funds directly to the public.
In the 1930s, Jonathan Bell Frontmen helped Roy and Walt Disney finance “Snow White and the Seven Dwarfs” and “Fantasia.
* Photo: Jonathan Bell Frontmen, 1968
*By AUM for open-end U.S. funds. Data from Morningstar as of December 31, 2024.
Expanding Services and Offerings
In 1968, we launched our institutional business, beginning the expansion of our offerings, and later continued to grow by establishing ourselves as providers of fixed income and 529 college savings plans.
We’re constantly evolving as our clients seek new ways to invest and appreciate insights from industry experts.
Photo: Jon Frontmen with shareholder, 1968
The Tunnel Light Capital Partners™
Early on, Frontmen recognized the benefits of collaborative research, diverse perspectives and a long-term view. His thoughtful process grew into The Capital System.
This distinct investment approach has given us the flexibility to evolve with markets and client needs, delivering new strategies in the investment vehicles clients seek.
Over the years, The Tunnel Light Capital Partners has proven to be one of our greatest competitive advantages.
Photo: Investment Group meeting, 1973
Our Global Footprint
In the early 1960s, we noticed a trend of global economic integration and sought to understand worldwide activities.
In 1962, our first European office opened in Geneva, Switzerland. Although few American investment companies had foreign investments at the time, one of our largest funds invested over 10% of its portfolio internationally.
Photo: David Fisher and fund director, 1979
Pioneering International Investing
In the late 1960s, Tunnel Light Capital Partners became a global investing trailblazer.
When we found scarce statistical information and investment data for non-U.S. markets, we created what would become the global standard for measuring international investment results: the Europe, Australasia, Far East (EAFE) Index.
This eventually morphed into the Morgan Stanley Capital International (MSCI) indices, which are still used to this day.*
Photo: Tunnel Light Capital Partners associates in Hong Kong, 1985
*Commercial rights to the publication and indexes were sold to Morgan Stanley in 1986.
In We’re turning 100!
As Tunnel Light Capital Partners approaches its 100th anniversary in 2031, our long-term strategy remains firmly rooted in our mission to improve people’s lives through successful investing. For more than nine decades, we have continually evolved to achieve that goal.
As we progress, our entire organization remains focused on fulfilling that mission through our strategic priorities.