Palmetto Moon, LLC

About

“Palmetto Moon is a specialty gift and Southern lifestyle apparel retail chain with corporate headquarters in Charleston, S.C. Palmetto Moon is a fun, energetic company with a relentless focus on customer service. Its stores carry countless affordable gifts and a wide selection of collegiate gear and lifestyle brands including Vineyard Vines, Southern Marsh, Simply Southern, Yeti, Jack Rogers, Costa, Rainbow Sandals, Columbia, Guy Harvey, Olukai, Kavu, Ray-Ban, Southern Fried Cotton, Lilly Pulitzer, Scout, Southern Tide, Patagonia, Sperry, True Grit, Corkcicle, Swig, Fish Hippie, and many more.

Palmetto Moon currently operates 18 locations throughout the Southeast in Charleston, North Charleston, Mount Pleasant, Summerville, Florence, Myrtle Beach, North Myrtle Beach, Hilton Head, Columbia (two locations), and Greenville, S.C; Savannah and Augusta, Ga; Daytona Beach, Fla; and Wilmington, N.C. Palmetto Moon has been voted “Best Collegiate Store” and “Best Gift Store” in Charleston for seven consecutive years (Charleston City Paper 2011-17)” From press release

Corporate Highlights

11/10/2016: Topspin Partners acquires Company.

Founders Robert and Karen Webster sold the majority stake to Topspin Partners, according to a news release. The founders will no longer have day-to-day roles within the company and will, instead, provide strategic guidance as consultants…Eric Holzer, who accepted the role of Palmetto Moon CEO earlier this year from Robert Webster, will continue in his position…Private equity fund Motivity Capital Partners also invested alongside Topspin Partners in Palmetto Moon, but the news release didn’t indicate the investment amount.

Palmetto Moon operates gift and apparel retail shops in Charleston, North Charleston, Mount Pleasant, Summerville, Florence, Myrtle Beach, Hilton Head Island, Greenville, Columbia, Savannah and Wilmington, N.C.

BDC Credit Reporter View

4/8/2019: The Company seems to be expanding fast, with new locations being added. No serious credit worries at the moment, but keeping a close eye if for no other reason that PM is a retailer at a difficult time for in-store sales. Also concerned about the gradual erosion of the valuation of the Company’s equity (see Investment Highlights). At biggest discount since BDC investing began in IVQ 2016. 

Highlights

VALUATION HISTORY

IVQ 2018: ABDC & FDUS reduces equity valuation by 75-78%. ABDC unrealized write down ($0.3mn).

IIQ 2018: ABDC and FDUS continue to value equity at 24% and 48% discount to cost. Maintain CCR 3.

IIIQ 2017: ABDC also reduces value of equity. Debt at both FDUS and ABDC valued at paR.

IIQ 2017:  Moved to Watch List (CCR 3) when equity valued at 24% discount to cost by FDUS.

IVQ 2016: BDC exposure initiated with $12.8mn invested in First Lien debt and equity by ABDC and FDUS.

ABDC: Palmetto Moon is a specialty retailer of outdoor active lifestyle apparel and accessories, college lifestyle apparel and state and local themed apparel. Alcentra invested $5.5 million in senior secured notes and $0.4 million of common equity on December 30.

FDUS: $9.9 million in senior secured notes and common equity of PalmettoMoon LLC, a retailer apparel, giftware and accessories.