HM Capital Partners
| HM Capital | |
| Formerly |
|
|---|---|
| Company type | Limited liability company |
| Industry | Private equity |
| Founded | 1984 |
| Founders | |
| Defunct | 2013 |
| Fate | Dissolved |
| Headquarters | , |
| Products | Leveraged buyouts, Growth capital |
| Website | hmcapital.com |
HM Capital Partners was a private equity firm based in the United States that focused on leveraged buyout transactions. Initially established in 1989 under the name Hicks, Muse & Co. by Tom Hicks and John Muse, the company adopted its later name in 1994 to recognize the contributions of partners Charles Tate and Jack Furst.
Hicks & Haas
In 1984, Tom Hicks, who had experience in venture capital at First National Bank, teamed up with Robert Haas to create Hicks & Haas. One of their significant accomplishments involved acquiring multiple soft drink brands such as Dr Pepper and 7 Up, which they combined and took public within a span of 18 months. This transaction turned an $88 million investment into a valuation of $1.3 billion. The partnership dissolved in 1989 due to divergent investment philosophies; subsequently, Haas founded the middle-market private equity firm Haas Wheat & Partners.
Hicks, Muse, Tate & Furst (HMTF)
By 1989, Hicks secured $250 million in capital and joined forces with John Muse, formerly of Prudential Securities, to form Hicks Muse. Their initial investments included Life Partners Group, a life insurance company. In 1991, Charles Tate from Morgan Stanley and Jack Furst from First Boston were brought on as partners.
Adopting a buy-and-build approach, Hicks Muse acquired DuPont’s connector systems division in 1993, renaming it Berg Electronics. The firm expanded this business through six additional acquisitions before divesting it in 1998. Nonetheless, some investments underperformed; notably, the acquisition of bankrupt brewer G. Heileman Brewing Company in 1994 resulted in a near $100 million loss when sold two years later.
The company took its Chancellor Media radio group public in 1996 and that same year entered the Latin American market with purchases including Mexican insurer Seguros Commercial America and International Home Foods, known for brands like Jiffy Pop and Chef Boyardee.
In 1997, Chancellor merged with Evergreen Media to create Chancellor Media (which was renamed AMFM in 1999). Hicks Muse continued expanding its media holdings across the U.S. and Latin America while diversifying into sectors such as UK software development, Danish seed production, and U.S. direct selling with Home Interiors and Gifts. A strategic alliance with Kohlberg Kravis Roberts led to the formation of Regal Cinemas—the largest theater chain in the U.S.—though Regal filed for bankruptcy protection in 2001.
The firm also invested $400 million in Teligent Inc., a fixed wireless telecommunications provider that later declared bankruptcy. In the energy sector, it acquired Triton Energy and launched a $1.5 billion European fund in 2001.
In 1999, acquisitions included UK food conglomerate Hillsdown Holdings, a stake in Mexican flour producer Grupo Minsa, and luxury champagne houses Mumm and Perrier-Jouët—assets that delivered a fourfold return upon their sale in 2000. Additionally, the firm purchased Walden Residential Properties during a downturn in the REIT market.
Partnering with UK-based Apax Partners, Hicks Muse acquired British Telecom’s yellow pages division Yell Group for approximately $3.5 billion—the largest non-corporate leveraged buyout in Europe at that time—and subsequently bought U.S. directories publisher McLeodUSA before taking Yell Group public in 2003.
Between 2002 and 2003, Hicks Muse expanded Premier Foods by acquiring Nestlé’s Ambient Food Business (including brands such as Crosse & Blackwell and Branston Pickle), cereal producer Weetabix Limited, and Unilever divestitures Ambrosia and Brown & Polson.
By 2004, further acquisitions included Kerns Oil & Gas (rebranded as Blackbrush Energy), Canadian cable operator Persona Inc., Regency Gas Services, Centennial Puerto Rico Cable TV, and a majority interest in luxury footwear brand Jimmy Choo. The firm also divested holdings in Yell Group and Premier Foods.
In May 2005, HM Capital Partners purchased Sturm Foods of Manawa, Wisconsin—a manufacturer specializing in bulk goods such as oatmeal and private-label sugar-free products.
HM Capital and Its Successors
Following the collapse of the internet and telecommunications bubbles, Hicks Muse encountered substantial difficulties, ranking among the most prominent private equity firms to suffer severe losses alongside Forstmann Little. The firm experienced a decline exceeding $1 billion due to minority investments in six telecom and thirteen Internet companies at the height of the 1990s market, further exacerbated by bankruptcies in conventional buyouts like Regal Cinemas and Viasystems Group. These challenges significantly harmed both its reputation and standing within the industry.
In 2004, Tom Hicks departed from Hicks Muse, with co-founder John Muse stepping into leadership. Subsequently, Hicks established Hicks Holdings LLC, while Charles Tate exited the company in 2002. The firm's European operations spun off in 2005, creating Lion Capital LLP, which has since amassed over $4 billion through two private equity funds.
The year 2006 marked a rebranding to HM Capital, reflecting shifts in leadership. The company began to rebound by attracting institutional capital for a $1 billion private equity fund—its first fundraising effort in more than five years. Despite this progress, HM Capital initiated its wind-down in 2013; its energy division was separated as Tailwater Capital, and its food sector became Kainos Capital.