The Business

Royal Baths Manufacturing Company, Ltd. (www.royalbaths.com) is a Houston, Texas-based developer, manufacturer and marketer of acrylic and cultured marble bathroom products, including soaker and whirlpool bathtubs, vanity tops, sinks, shower walls and bases. Royal offers residential homebuilders one of the most robust product offerings among its competitors, and with its flexible, mass customization manufacturing capabilities, is a low-cost producer among its peers. Royal maintains the leading market position in the most favorable geographic markets for building products in the U.S. – Texas and Florida. Within its served geographic markets, Royal has pioneered a unique, direct-to-builder strategy that acts as a barrier to entry and has led to long-term relationships with virtually every national and regional home builder in Texas and Florida.

The Industry

Royal participates in the $500+ billion U.S. private residential construction market. The single most important demand driver for Royal’s products is the construction of new residential houses. U.S. housing starts are expected to fully rebound over the next five to ten years, and are already up nearly 80% from recessionary lows in 2009. As the housing market continues its recovery, Royal is well positioned for continued growth, serving six of the nation’s top 20 largest metropolitan statistical areas for housing permits issued.

The Process

Prestwick Partners initiated this transaction and acted as the exclusive financial advisor to Royal Baths and Linsalata Capital Partners (LinCap), a Cleveland, Ohio-based private equity group. Prestwick designed an M&A process, prepared marketing materials, evaluated acquisition proposals and negotiated the transaction with Cotton Creek Capital, a Dallas, Texas-based private equity group. Prestwick’s process included both domestic and international strategic acquirers as well as private equity groups.