John Rebchook
ROCKY MOUNTAIN NEWS
The Greenwood Village-based private equity investment firm of Mankwitz Kurtz Investment LLC wants to hit a home run on each deal it makes.
No, make that a grand slam.
MKI is headed by accountant Stephen S. Kurtz, who helped bring the Colorado Rockies to Denver, and his brother-in-law Van Mankwitz and Brian Mankwitz. Brian is Van's son and Kurtz's nephew.
``We're always swinging for the fences,'' said Brian Mankwitz, who is about to take a year off to get his master's degree in accounting and finance from the London School of Economics.
``We find it takes as much time and effort to hit singles and doubles,'' he added.
Kurtz noted that MKI is a true family firm.
``I like to say that Van showed up in my sister's room in college 30 years ago, and he hasn't left since,'' Kurtz said.
The firm shops for undervalued companies with annual revenues from $5 million to $500 million that they can buy, beef up and sell within five years for many times what they paid. They like companies to have the potential to be distributed nationally and internationally.
``We're very tough buyers, tough sellers and tough managers in between,'' Kurtz said. ``A lot of our profit comes because we bought right. And we have many exit strategies.''
He said they probably look at 100 companies for every one they buy.
MKI currently controls companies in Colorado, California and Arizona.
Kurtz and Van Mankwitz began doing deals together in 1980. In their first deal, they bought the Colorado Auto Auction for $2 million. The auction house sold cars to dealers. They built up the company until it more than doubled its annual sales volume to $80 million, and sold it for $12 million in 1985.
Kurtz, meanwhile, also ran Shenkin, Kurtz & Baker Co., an accounting, financial and investment banking firm. Some of his former clients are investors on MKI deals.
In 1997, Kurtz sold his firm to Century Business Services and bought other accounting firms for the Cleveland-based company before launching MKI about three years ago.
``One day Van called me up and asked what I wanted to do, and I said I wanted to do what we had been doing sporadically over the years, but do it full time,'' Kurtz said.
So far, they've taken control of a wide range of companies.
Holdings include Esscentual Brands, a fragrance and personal care products company in Phoenix, and Santa Barbara, Calif.-based Isera Group, which provides technology systems for complex scheduling for military and commercial customers. They paid $2 million for Isera, and in the next year or two expect to sell it for more than $30 million.
In Colorado, MKI is winding down Construction Mortgage Lending, which makes loans to owners of manufactured-housing units.
Their partner in that venture is Denver real estate investor Andy Miller, head of Sevo Miller.
``They're the greatest,'' Miller said about his partners. ``Each of them brings an unbelievable amount of talent to the table.''
Miller has invested in Esscentual Brands, which includes the brands Claire Burke and Vitabath.
MKI's only other local company is Castle Technology Exchange, which acts as a broker for older telecommunications and data processing equipment. Much of the equipment has never been used. And while not the latest cutting-edge technology, it's also available for a fraction of the cost, Kurtz said.
Their only regret is they can't find more companies in their back yard.
``And I'd love to move our companies to Denver, but in this day and age, it is just too difficult and expensive,'' Van Mankwitz said.
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