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Compass Diversified Holdings (CODI)
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Compass Diversified Holdings Completes Strategic Sale of Sterno’s Food Service Business

Last updated: May 04, 2026
Taurigo

May 4, 2026 – New York, NY – Compass Diversified (NYSE: CODI), a prominent player in the middle-market investment sector, has announced the successful completion of the sale of its majority-owned subsidiary, SternoCandleLamp Holdings, Inc.'s food service business. The transaction, finalized on May 1, 2026, marks a significant milestone in CODI's ongoing strategy to streamline operations and enhance financial flexibility.

1. Sale Details and Financial Impact

The food service business of Sterno was sold to Archer Foodservice Partners, a leading provider of foodservice consumables and a portfolio company of Wynnchurch Capital, L.P. The sale was executed at an enterprise value of $292.5 million, which is subject to customary adjustments related to working capital and other factors. Following these adjustments and the allocation to non-controlling shareholders, Compass Diversified received approximately $280 million in proceeds at the closing of the transaction.

The proceeds from this divestiture are earmarked for repaying outstanding senior secured debt. This strategic move is expected to reduce CODI’s senior secured net leverage ratio to below 1.0x by June 30, 2026, thereby aiding the company in avoiding additional fees tied to excess leverage under its senior secured indebtedness.

2. CEO's Insights

Elias Sabo, CEO of Compass Diversified, expressed optimism regarding the sale, stating, “The closing of this transaction marks a meaningful step forward in our ongoing deleveraging efforts. We moved quickly to execute this sale at a favorable valuation amidst a challenging macroeconomic backdrop. We are grateful to the Sterno team for their many contributions and believe the food service business is well positioned for its next chapter with Archer.”

3. Advisory and Legal Support

The transaction was supported by a team of financial advisors and legal counsel. Raymond James acted as the financial advisor to Sterno, while Jefferies served as the financial advisor to Compass Diversified. On the legal front, Brownstein Hyatt Farber Schreck, LLP represented both Sterno and CODI.

4. About Compass Diversified

Compass Diversified is known for leveraging its permanent capital base and maintaining controlling ownership interests in its subsidiaries. This approach allows CODI to maximize its impact on long-term cash flow generation and value creation. The company provides both debt and equity capital to its subsidiaries, enhancing their financial and operational flexibility while fostering a culture of transparency, alignment, and accountability.

The recent sale of Sterno's food service business underscores CODI's proactive approach in optimizing its portfolio and positioning itself favorably for future growth. As the company moves forward, stakeholders will be keenly watching how these strategic decisions unfold in the ever-evolving market landscape.

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