Round 2 News #1: Round 2 has been sold UPDATED
UPDATE: Round 2 shared a press release on Monday, Feb. 1, 2021, clarifying the sale and company plans for the future. They said:
Round 2, a leading collectibles company that produces model kits, die-cast cars and slot cars announced today that it has partnered with Praesidian Capital. Praesidian Capital is a leading private investment group headquartered in Larchmont, New York and acquired controlling interest (51%) of Round 2.
Round 2 press release
Round 2 President and Founder, Thomas Lowe stated, “I’m thrilled to be partnering with the Praesidian team as they will bring significant resources as we continue to scale the business, both organically and through acquisitions. It’s also really great that there are no staff changes and the headquarters remains here in South Bend, IN. Our customers can be assured that it is business as usual at Round 2, with lots of continued growth to come.”
The new info here is that Praesidian owns 51% of Round 2, in what is described as a “partnership.” Lowe is clarifying that Round 2 is focusing on growth and will retain its staff and operations in South Bend. This is welcome news.
Round 2, the parent of Polar Lights, AMT, MPC, as well as many other brands has sold controlling interest in the company to Praesidian Capital, a private equity investment firm. This was announced earlier this week in an industry press release.
Tom Lowe, the founder of Round 2 is quoted as saying “I’m thrilled to be partnering with the Praesidian team as they will bring significant resources as we continue to scale the business, both organically and through acquisitions,”
Praesidian founder, Jason Drattell said “We are excited to partner with Tom Lowe, founder and CEO of Round 2,. Round 2 has emerged as a market leader in the collectibles space and we look forward to supporting the management team as the Company continues to expand its product offerings.”
The press release noted that Round 2 has many licenses including “General Motors, Ford, Star Trek and Star Wars,” This is the first public acknowledgement that the company has a Star Wars license.
Praesidian Capital is described as “an innovative private investment firm focused on providing senior and subordinated debt along with growth capital to private lower middle market businesses in the United States, United Kingdom, Germany, and selectively in Northern Europe. Praesidian also recently launched a private equity strategy focused on control positions in lower middle market businesses.”
So what does this mean? Good question! We’ve been through this song and dance before. Back in 2004, Playing Mantis, the parent company of Polar Lights was aquired by RC2 (later Learning Curve.) RC2 had purchased a number of toy brands, including AMT, Ertl and several others. RC2/Learning Curve later shut down many of the brands including the model companies. Those were grim days. Later, Tom Lowe was able to gain control of his original brand Polar Lights and others and relaunched as Round 2.
Based on the information in the press release, Lowe is still active in the company and Praesidian appears to be infusing the company with capital. This indicates a push to grow and expand the brand. The fact that they now have Star Wars licensing reflects this analysis .
Ultimately, we have cause to be optimistic that this is good for the company and good for the hobby industry. Time will tell!
Please check out the Round 2 News #2
I will post more information if it becomes available.
