Sourcelink

SourceLink, headquartered in Chicago, Illinois with four other locations across the U.S., is a full-service direct marketing company specializing in direct mail production and message tracking as well as database analysis and targeting. SourceLink draws on industry-leading data intelligence, technology and an intense client focus to produce dynamic, results-driven communications that drive response and ROI.

In early 2005, Summit was approached by the agent of SourceLink’s banking syndicate about acquiring the debt. At that point in time SourceLink was a failed roll-up on the brink of bankruptcy whose sponsor, a large private equity firm, had essentially abandoned the company by turned the Board over to a national restructuring firm. Over the preceding seven years, the equity sponsor had acquired 12 autonomous direct marketing providers and merged them into eight divisions within SourceLink with little centralized direction. As a result of the poor performance of the acquired purchases, the company was severely overleveraged and unable to meet its current obligations.

Summit acted quickly and was able to purchase approximately 55% of SourceLink’s senior debt (while another large investment group purchased the remaining 45%). Due to the nature of several of SourceLink’s customer contracts, bankruptcy was not an option if the company was going to survive. Therefore, in concert with the other investment group the assets were acquired via an Article 9 sale into a new entity with some of company management being retained. The new entity was properly capitalized to help them weather the transition and pay critical vendors who in many cases were significantly in arrears. Summit worked with the company to immediately consolidate two divisions and create synergies among the remaining six. Through the restructuring the company experience no loss of its customers base including retaining all Government contracts.

Over the past two years, Summit has continued to work with SourceLink’s management to drive efficiencies and, as a result, has sold one division and consolidated one more. Today, SourceLink is poised to grow through any economic cycle and is one of the largest independent direct marketing firms in the U.S. and a leading provider of integrated end-to-end direct marketing services. Summit remains the majority debt and equity holder in SourceLink and plans to continue to help the company improve and grow in the future.