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December 17, 1996 - Castle Harlan Partnership Completes Acquisition Of Balfour and ArtCarved Class Ring Businesses

NEW YORK, December 17 -- Castle Harlan, Inc., the New York merchant bank, announced today that an investment partnership it manages had completed the purchase of two businesses that make and market school rings for college and high school students under the brand names Balfour and ArtCarved. The price was $130.6 million, including fees and expenses, plus $40.6 million for working capital.

 

The partnership, Castle Harlan Partners II, L.P., acquired the ArtCarved division of CJC Holdings, Inc., of Austin, Texas, and the L. G. Balfour subsidiary of Town & Country Corporation, Boston, Castle Harlan said. The two businesses are being combined in a newly formed company, Commemorative Brands, Inc., which will have its headquarters in Austin.

 

As a result of the combination of the two companies, Commemorative Brands becomes one of the largest manufacturers and sellers of class rings in the country. David Pittaway, managing director of Castle Harlan, noted that the company will be positioned in the two principal distribution channels used by the industry -- sales through in-school distributors and through jewelry stores and other retailers.

 

In addition to class rings, the company makes fine paper products for the scholastic market, such as diplomas, graduation announcements, certificates and stationery, as well as championship rings, consumer sports jewelry and family jewelry for special occasions.

 

George E. Agle, who has been president and chief executive officer of Balfour, will become chairman of Commemorative Brands. Jeffrey H. Brennan, president and chief executive officer of CJC, will have the same titles with Commemorative. Six other officers of Balfour and CJC will become executives of the new company.

 

Balfour had previously announced that its facilities in Attleboro and North Attleboro, Massachusetts, which had been operating at only about 50 percent of capacity, would be closed, and those operations would be consolidated with the existing ArtCarved operations in Austin, Texas. Employees at the Massachusetts plants will be offered jobs in Austin, Pittaway said.

 

On a pro forma basis, for the fiscal year ended August 31, 1996, Commemorative had sales of $142 million and earnings before taxes of approximately $22 million.

 

Castle Harlan Partners II, L.P., is a private equity investment partnership managed by Castle Harlan with capital of $275 million from major corporate and public pension funds, college endowments, foundations and individual investors. Since Castle Harlan's founding in 1987, it has completed acquisitions exceeding $2.5 billion.

 

Castle Harlan's portfolio companies have included Delaware Management Company, a Philadelphia money-management firm with more than $30 billion under management; Ethan Allen Interiors; Smarte Carte, the airport luggage-cart rental company, and Morton's Restaurant Group, owner of the Morton's of Chicago steakhouses.

 

Castle Harlan was founded by John K. Castle, a pioneer in institutionalizing private equity investing through limited partnerships and the former president and chief executive officer of Donaldson, Lufkin & Jenrette, the investment banking firm, and by Leonard M. Harlan, founder and former owner and chairman of The Harlan Company, a diversified real estate and corporate finance advisory firm.