Home News Wal-Mart and Pinnacle Minority Supplier Development Fund Announce Beneficiaries of Private Equity Fund Investments

Wal-Mart and Pinnacle Minority Supplier Development Fund Announce Beneficiaries of Private Equity Fund Investments

Retailer’s $25 Million Investment Promotes Growth of Minority and Women-Owned Companies

BENTONVILLE, Ark. (July 19, 2007) – Wal-Mart Stores, Inc. and the Pinnacle Minority Supplier Development Fund (Pinnacle) announced today the latest portfolio companies of their private equity co-investment fund. The fund’s most recent investments include, Total Transportation Services, Inc. (TTSI), MAYA Cinemas North America, Inc., The Warrior Group, Inc. (TWG) and MAYA Entertainment. Siméus Foods International, Inc. (SFI) was the first investment of the fund in May 2006. To date, Pinnacle has invested in a wide range of companies representing a wide variety of industries including: logistics services; movie theatres; modular building manufacturing and site development; production, acquisition and distribution of motion pictures; and food products.

The private equity fund was established as a resource for minority and women-owned businesses seeking capital for further growth. To date, nearly half of Wal-Mart’s $25 million investment has been invested in minority and women-owned enterprises.

“Through the Pinnacle Minority Supplier Development Fund, Wal-Mart is able to further its commitment to increasing the number of diverse suppliers and assisting businesses, such as these five companies, in strengthening their operations,” said Esther Silver-Parker, senior vice president of diversity relations, Wal-Mart Stores, Inc. “These investments serve as an important resource to help advance the businesses of talented women and minority-owned enterprises to better serve their customers and communities.”

The portfolio companies in the fund are majority minority-owned businesses, including three owned and operated by African-Americans including one woman, and two led by one Hispanic entrepreneur. Additionally, each portfolio company is certified as minority or women-owned or minority-controlled businesses as defined by the National Minority Supplier Development Council and the Women’s Business Enterprise National Council (WBENC).

These portfolio companies represent a diverse group of entrepreneurs penetrating various markets with initiatives to further enhance communities. The goal of Pinnacle is to invest in minority and women-owned businesses that demonstrate great potential in becoming major suppliers to a broad community of retail corporations.

In October 2005, as part of its ongoing commitment to supplier diversity, Wal-Mart committed to investing in Pinnacle, which was formally named the Minority Supplier Development Fund.

Pinnacle invests in businesses that distribute or have the capacity to distribute products and/or services to major retailers and clientele, and expects to invest in 10 to 12 companies in the fund, exiting each investment within a five-year holding period.

“Wal-Mart’s investment in the Pinnacle Fund underscores the company’s support of these businesses,” said Harriet R. Michel, president of the National Minority Supplier Development Council. “By providing capital to diverse businesses, Wal-Mart and the Pinnacle Fund are providing solid growth opportunities that are so critical to the continued development and success of minority firms.”

Wal-Mart has long maintained diversity initiatives, including personnel practices and supplier programs, to help build and retain a diverse workforce and supplier base along with varied community outreach programs. As part of its ongoing commitment to diversity and empowering women and minority-owned businesses to further advance their operations, Wal-Mart partners with more than 3,500 diverse suppliers to provide customers and associates with the products and services they need and want. Wal-Mart’s Supplier Diversity Program has grown from $2 million initially spent with minority and women-owned businesses to more than $4.2 billion in 2006.

“Wal-Mart continues to support diversity by investing in its supplier’s businesses, such as our WBE member, The Warrior Group, allowing minority and women-owned businesses to build their capacity and secure their future in corporate supply chains,” said Linda J. Denny, president, Women’s Business Enterprise National Council. “Wal-Mart’s steps to grow its vendor diversity program serve as a testament to many other retail-centered corporations. These investments made by Wal-Mart and Pinnacle will accelerate the growth of women and minority-owned businesses and increase their economic impact on communities nationwide.”

For additional information regarding the Pinnacle Minority Supplier Development Fund, please email all inquiries to inquiries@pinnaclecoinvest.com.

About the Pinnacle Portfolio Companies
Siméus Foods International, Inc. (SFI)
SFI, founded in 1996, is a privately-owned manufacturer of a wide variety of high-quality frozen food products for the restaurant industry, including ready-to-cook meats, appetizers, soups and sauces.  Ranking as the 24th largest black-owned company in the United States according to Black Enterprise, SFI employs more than 400 workers and has processing plant locations in Texas and North Carolina.

SFI founder and CEO, Dumas M. Siméus, is an executive with global experience including expertise in general management, corporate finance and inspirational leadership. Prior to founding Siméus Foods, Siméus was President of TLC Beatrice. He transformed his business from an in-house supplier, to a competitive business with a diversified pool of customers including, Quizno’s, Burger King, Denny’s, Hardee’s, TGI Friday’s, Olive Garden, Red Lobster and ARAMARK. 

Through Pinnacle, SFI received an investment of $5 million. Overall, the company received $25 million, which was used as a source of growth capital, allowing the company to pursue a number of strategic initiatives to better serve its customers, including an innovative marketing campaign and industrial packaging plant, among other growth initiatives.

Total Transportation Services, Inc.
Founded in 1991, TTSI provides a range of logistics services including local drayage, truckload brokerage and warehouse/fulfillment to several clients including Ralph Lauren, Sony and JVC, among others. Albert Frazier, an African-American entrepreneur, purchased a controlling interest of the company in 2006 and is TTSI’s current CEO and chairman of the Board. Today, the company, which maintains operations in

Los Angeles, Calif., Long Beach, Calif. and Norfolk, Va., oversees more than 200,000 shipments by sea, air and rail annually, delivering everything from apparel to technology.

As part of Frazier’s financing of the TTSI acquisition, Pinnacle invested $1 million in the company. Along with helping to facilitate the acquisition of TTSI, some of the capital was used to expand its infrastructure, particularly allowing TTSI to hire added personnel to aggressively grow its business. Since Frazier’s acquisition of TTSI, there have been additional acquisitions that have substantially grown the business, and has also led to the formation of Goods Movement, Inc., an affiliate of TTSI. In concert with the return of Pinnacle’s original investment in TTSI, the transaction yielded an impressive overall return.

MAYA Cinemas North America, Inc.
MAYA Cinemas North America, Inc. is working to develop a chain of 25-30 megaplex movie theatres with a total of 400-500 screens over a five-year period, in addition to the company’s existing megaplex theatre. The projects target rural destinations and urban and suburban redevelopment areas with a strong Latino presence. MAYA Cinemas will build state-of-the-art, digital sound, stadium-seating megaplexes with Mayan-inspired modern architecture reminiscent of the age of exotic movie palaces. The theatres will include personal amenities that will provide comfort and an upscale feel. Moctesuma Esparza, founder and CEO of MAYA Cinemas, is well known in the movie industry and has specific expertise in production, acquisition and marketing. A distinguished film producer of more than 30 years, Esparza is also the CEO of MAYA Entertainment. 

MAYA Cinemas North America, Inc. received total financing proceeds of $10 million, including $2.5 million from Pinnacle. The proceeds will be used for the development of seven additional theatre projects in which the land has already been acquired; the projects are in various stages of development.

MAYA Entertainment
MAYA Entertainment is a motion picture production, acquisition and distribution company that provides English and Spanish-language films targeting the growing Latino movie-going and home video audiences. MAYA has two main divisions that contribute to the company. MAYA Pictures, the production division, was created to target the Latino movie-going audience. MAYA Releasing, the distribution division, will develop stand-alone theatrical and home-video distribution capability. Moctesuma Esparza, considered a leader in the creation of Latino-themed films in Hollywood, is the founder, CEO and co-chairman, and is responsible for driving the overall vision and supervision of the organization.

Pinnacle invested $2.5 million as part of a total $30 million transaction. Proceeds will be used for the development, production, distribution, exploitation and advertising of urban Latin-themed art and commercial motion pictures for theatrical, non-theatrical, television, home video and/or other general urban-oriented properties. Additionally, the funds will assist with MAYA Entertainment’s 145 projects planned over the next six years.

The Warrior Group, Inc.
The Warrior Group, Inc. (TWG) is a leading designer, manufacturer and site development manager for modular buildings. The Dallas-based company was founded in 1997 by Gail Lawrence, an African-American entrepreneur. TWG is a certified vendor and is currently wholly owned by Lawrence, who is regarded as a leader and innovator within the modular building industry and minority and women’s business councils throughout the United States. The company is a highly-publicized, woman-owned firm, widely recognized as an industry leader having significant growth potential.

Pinnacle invested $1 million of a total financing amount of $4.25 million. The company was recently awarded a multi-million contract by the U.S. Army to supply housing barracks at Fort Bliss in El Paso, Texas. The proceeds will facilitate the supply and installation of modular barracks, as well as to expand the company’s personnel.

PLEASE NOTE: Additional information about the five companies is available upon request.

About Wal-Mart Stores, Inc. (NYSE: WMT)
Every week, millions of customers visit Wal-Mart Stores, Supercenters, Neighborhood Markets, and Sam’s Club locations across America or log on to its online store at www.walmart.com. The company and its Foundation are committed to a philosophy of giving back locally. Wal-Mart (NYSE: WMT) is proud to support the causes that are important to customers and associates right in their own neighborhoods, and last year gave more than $270 million to local communities in the United States. To learn more, visit www.walmartfacts.com, www.walmartstores.com, or www.walmartfoundation.org.

About the Pinnacle Minority Supplier Development Fund
The Pinnacle Minority Supplier Development Fund is a $25 million private equity co-investment fund designed to invest in and further enhance the growth of a select group of MBE certified minority and women-owned businesses. As a co-investment fund, Pinnacle invests “alongside” a diverse pool of institutional quality private equity firms into a targeted group of companies that produce and sell retail products and/or services. Access to capital has served as a major impediment to many minority and women-owned companies’ ability to achieve their full growth potential. As such, Pinnacle seeks to help mitigate such obstacles through a source of strategic growth capital.

About National Minority Supplier Development Council
Providing a direct link between corporate America and minority-owned businesses is the primary objective of the National Minority Supplier Development Council, one of the country’s leading business membership organizations. It was chartered in 1972 to provide increased procurement and business opportunities for minority businesses of all sizes. The NMSDC Network includes a National Office in New York and 39 regional councils across the country. There are 3,500 corporate members throughout the network, including most of America’s largest publicly-owned, privately-owned and foreign-owned companies, as well as universities, hospitals and other buying institutions. The regional councils certify and match more than 15,000 minority owned businesses (Asian, Black, Hispanic and Native American) with member corporations which want to purchase goods and services. 

About Women’s Business Enterprise National Council
The Women’s Business Enterprise National Council (WBENC), founded in 1997, is the nation’s leading advocate of women-owned businesses as suppliers to America’s corporations. It also is the largest third-party certifier of businesses owned and operated by women in the United States. WBENC works to foster diversity in the world of commerce with programs and policies designed to expand opportunities and eliminate barriers in the marketplace for women business owners. WBENC works with representatives of corporations to encourage the utilization and expansion of supplier/vendor diversity programs.