Company Overview

1847 Holdings LLC (OTCQB: EFSH) acquires and operates American companies it acquires at attractive valuations, leveraging its management team’s extensive experience gained at leading investment firms, such as Colony Capital, Lazard Freres and Saunders, Karp & Megrue, to grow operations and create value. 1847 may opportunistically monetize the ownership of operating subsidiaries over time to generate returns on capital for 1847 shareholders via outright sales, recapitalizations or spin-offs. Current assets in its portfolio include Goedeker’s, one of the top-30 largest appliance retailers in the country, Neese, an established agricultural services company, and Asien’s Appliances, a leading Bay Area appliance retailer. The Company completed a spin off of Goedeker’s in an IPO on the NYSE American in July 2020 and retains 51%+ ownership.

Acquisition Process

Acquisition Process logo

1847 Holdings: Acquisitions and Spinoffs of Growing US-Based Businesses

 

Value Proposition

1847 employs a unique public, private company holding platform that combines the attractive attributes of private, lower-middle market businesses with the liquidity and transparency of a publicly traded company. Its only public-company comp, Compass Diversified Holding (NYSE: CODI), has a current market cap in excess of $1 billion and is up 344% since its 2006 IPO, compared to 193% for the S&P 500 and 163% for the Russell 2000 over the same period. 1847 seeks opportunities for growth and margin improvement of its subsidiary holdings through additional resources and implementation of return-driven metrics and accountability. Leveraging an expansive network of deal flow contacts in a niche of the private company arena often overlooked by investment banks and larger private equity funds, 1847 is ideally positioned to scale and manage its portfolio.

Investment Highlights

  • Strong management team with expansive deal flow network
    • Led by founder and CEO Ellery W. Roberts, former Managing Director of SKM Growth Investors LP, a Dallas-based private equity fund focused on recapitalizations, buyouts, and growth capital in lower middle-market companies, where he managed $400M across two funds; previously Roberts was a principal at Lazard Freres & Co., where he was a senior team member involved in the investment of $2.4B+ of capital; and worked at Colony Capital, where he analyzed and executed transactions for a $625M private equity fund
    • Managing Director Edward Tobin was previously Director of Global Emerging Markets (GEM), where for 15 years he managed Special Situations and Venture investing for GEM’s Partners Capital Fund

  • Three completed acquisitions create solid foundation
    • Stable, mature businesses with margin improvement and revenue growth opportunities
    • The Company’s Goedeker’s acquisition is being spun out as an IPO
    • Trailing 12-month sales of first two acquisitions: $50.6M; third acquisition, Asien’s Appliances, was acquired after the most recent quarter was reported

  • Acquisition strategy focused on value creation; robust pipeline
    • Signed purchase agreement to acquire direct to builder and new construction custom cabinet maker
    • Institutes return-driven metrics/accountability and add resources (personnel, processes, and/or technology) to drive growth
    • Extensive deal network
    • Strategically evaluate exit opportunities of subsidiaries to monetize successes