Sentinel sells Massage Envy in management buyout transaction

Successful Exit of Nation’s Leading Franchisor of Massage and Spa Services

NEW YORK, September 30, 2012 – Sentinel Capital Partners, a private equity firm that invests in promising, lower middle market companies, today announced the sale of Massage Envy, the nation’s largest provider and franchisor of massage therapy and facial treatment services, to private equity firm Roark Capital Group. Terms of the transaction were not disclosed. Based in Scottsdale, Arizona, Massage Envy transformed the delivery of professional, convenient, and affordable massage and spa services to consumers with busy lifestyles. During Sentinel's ownership, Massage Envy grew rapidly, expanding from 600 clinics operating in 42 states to 800 locations in 45 states. Today, Massage Envy provides massage therapy, facial treatments, and wellness retail products to an active member base of more than 1.25 million every month. Massage Envy clinics are also the world's largest employers of licensed and registered massage therapists, numbering more than 20,000. Massage Envy was ranked No. 57 in Entrepreneur magazine's 2012 Franchise 500 and No. 29 in the magazine’s Fastest Growing Franchise rankings.

"Massage Envy is truly a special business that has had a profound impact on the wellness industry as well as franchising," said Jim Coady, a partner at Sentinel. "Since its inception a decade ago, Massage Envy has grown into a leading franchisor with $1 billion in system-wide sales, while changing the way consumers utilize massage therapy through using a membership-based model."

"The Sentinel team has been an excellent partner to us during this period of rapid growth," said David Crisalli, President and Chief Executive Officer of Massage Envy. "The Massage Envy brand and organization is stronger than ever. We are well positioned to continue its mission—providing a pathway to wellness through professional, convenient, and affordable massage therapy and spa services. We thank Sentinel for all of their contributions."

"We are fortunate to have worked with such a capable and dedicated management team," said John McCormack, co-founder and senior partner at Sentinel. "They have transformed the industry and created for Massage Envy a first mover advantage. And they have also positioned Massage Envy for further rapid growth."

Investment banking firms William Blair & Company and North Point Advisors advised Massage Envy in the transaction, and Kirkland & Ellis LLP provided legal counsel.