Citigroup Venture Capital and Existing Senior Management to

Press Release:

Citigroup Venture Capital and Existing Senior Management to Acquire IWCO Direct

Press Release
News Article February 2005

NEW YORK and CHANHASSEN, Minn., Feb. 7 /PRNewswire/ -- Citigroup Venture Capital Equity Partners L.P. (CVC) and IWCO Direct, the nation's leading provider of integrated direct mail production services and solutions, encompassing print, envelope, plastic, mailing and data services, announced today that CVC and the company's existing senior management team will acquire IWCO Direct from its current shareholders. The management team, led by Jim Andersen (President and CEO), Tom Wicka (Executive Vice President - Marketing & Sales) and Pete Karle (Executive Vice President and CFO) will continue to operate the company.

Commenting on the acquisition, Mike Delaney, Managing Partner of CVC said: "IWCO Direct has all of the qualities which are hallmarks of CVC investments, including strong growth prospects, a superior management team, and consistent and repeatable performance. We believe that IWCO Direct's integrated 'total package' supply chain management solution is unique in its industry and provides a strong value proposition to its blue-chip customer base of preeminent direct marketers.

"We look forward to supporting Jim Andersen and the rest of the company's world-class management team as they build upon their impressive performance to date. In particular, we hope to help the company accelerate growth through geographic expansion of its production capability to the East Coast of the United States."

Mr. Andersen added: "We feel very fortunate to have enjoyed strong direct mail trends over the past few years. In this environment, our integrated 'total package' business approach has resonated with clients and allowed us to form partnerships with some of the most prominent direct marketers in the world. Our partnership with CVC enhances our ability to add capacity and new services so that we can better serve our customers and take our business to a new level of market leadership."

Houlihan Lokey Howard & Zukin served as exclusive financial adviser and initiated, structured and negotiated the transaction on behalf of IWCO Direct. Its Minneapolis-based transaction team was led by Scott Richardson and Reed Anderson.

About IWCO Direct

IWCO Direct, headquartered in Chanhassen, Minn., has served the needs of North American direct marketers for more than 35 years. IWCO Direct provides direct mail like no one else by seamlessly providing all direct mail production services - printing, plastics, envelope conversion and mailing and data services - in an integrated "total package" supply chain solution. IWCO Direct's industry experience and technology along with proprietary P.O.S.T. (Postal Optimization Strategy and Technologies) and RideShare(TM) commingling and logistics management programs provide its customers with dramatic postage savings and faster time to market.

About CVC

Citigroup Venture Capital (CVC), one of the world's oldest and largest private equity firms, currently managing a $2.6 billion in private equity partnerships with major institutional investors and its parent company, Citigroup. Founded in 1968, CVC has been a lead investor in over 200 transactions over the last two decades including numerous LBOs and IPOs for a broad range of industries.

About Houlihan Lokey Howard & Zukin

Houlihan Lokey Howard & Zukin, an international investment bank established in 1970, provides a wide range of services, including mergers and acquisitions, financing, financial opinions and advisory services, and financial restructuring. The firm has over 600 employees in nine offices in the United States and the United Kingdom. It annually serves more than 1,000 clients ranging from closely held companies to Global 500 corporations.

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