Denver Investment Firm, KRG Capital Partners, Acquires Leading, Full-Service Logistics Provider.

Business Editors

DENVER--(BUSINESS WIRE)--May 1, 2003

KRG Capital Partners, the largest buyout firm headquartered in Denver, announced today the recapitalization of family-owned FMI, Inc.

FMI is the third portfolio company for KRG Fund II, and will serve as the platform for a consolidation in the logistics industry. KRG invested a total of $22 million in FMI, and has committed significant additional equity capital to enhance the growth of FMI. The Company's management team maintained a significant ownership interest, and will also continue to serve in their current roles with the Company. Additional financing for the transaction was provided by American Capital Strategies ($49 million) and Credit Agricole Indosuez ($20 million).

FMI is uniquely positioned to capitalize on the increased penetration of imported apparel into the United States through its fully integrated line of apparel import logistics services, including freight forwarding, transloading, deconsolidation, warehousing, distribution, and local and long-distance ground transportation. "The FMI management team proactively addressed the needs of its customers by incorporating the services and capabilities necessary to seamlessly move product from international ports to its customers' distribution centers in the U.S.," said Charlie Gwirtsman, Managing Director of KRG. "This full range of capabilities places FMI in the strategic position of becoming a one-stop provider to many of its customers." FMI's customers in turn receive greater visibility of their shipments along the entire transport route, enabling them to locate their merchandise at any point in the supply chain. This visibility is made possible through FMI's comprehensive inventory tracking system that in most cases is integrated with the individual customer's MIS systems.

FMI is also one of the few companies in the industry with expertise in garment-on-hanger shipping, a shipping method in which delicate apparel remains hung on slick rails throughout its transport, avoiding the weight and pressure of other garments that could adversely affect their appearance. FMI counts as its customers leading U.S. designers, manufacturers and retailers such as Jones Apparel Group, Inc., Liz Claiborne, Inc., Polo Ralph Lauren Corp., and Federated Department Stores.

FMI was represented by BB & T Capital in the transaction, and received substantial interest from both strategic and financial buyers. "From our very first meeting with KRG, we sensed a certain chemistry with the organization that we had not experienced with any other private equity group," said Gregory DeSaye, Chief Executive Officer of FMI. "They rapidly grasped the complexities of our business model, understood our growth potential, and shared the excitement of our enterprise in a real entrepreneurial fashion. We are excited about working with KRG and look forward to continued success with our new partners."

About KRG Capital Partners

Founded in 1996, KRG is the largest Denver-based private equity buyout firm and currently manages over $860 million of committed equity capital and equity co-investments. KRG specializes in acquiring and recapitalizing unique and profitable middle-market companies. The firm seeks investment opportunities for its partners where KRG can work in concert with owners and operating managers who are committed to expanding their companies and becoming industry leaders. The result is a partnership that focuses on creating a significantly larger enterprise through a combination of internal growth and complementary add-on acquisitions. Since inception, KRG has invested in 14 "platform companies" and has completed 42 add-on acquisitions for those platforms.

KRG is actively pursuing additional platforms in industry niches focused on certain macroeconomic and demographic trends. Targeted areas of interest include Healthcare, Construction Materials, Infrastructure, Outsourcing, Life Science Contract Manufacturing, Specialty Coatings and Chemicals, Education, Training, Transportation and Logistics and Consumer Products.

For more information on KRG Capital Partners, please visit www.krgcapital.com or contact Rob Martin at 727/789-1336.

About FMI, Inc.

Founded in 1979, FMI employs over 500 employees and has experienced annual growth of over 19% per year since 1999. Headquartered in Carteret, New Jersey, the Company's fully integrated line of services ensures the seamless transport of apparel from international manufacturing locations to U.S. retail distribution centers in a more efficient and cost-effective manner. FMI is also expanding outside of apparel into the imported footwear and household goods markets. FMI has gained its reputation as a high quality service provider through more than twenty years of experience in the market. With operations in the three largest U.S. gateways (Carteret, NJ / JFK Airport, NY; Carson, CA; and Miami, FL) FMI's national footprint provides the Company with a strategic advantage and is an important factor when FMI is pursuing new accounts. For more information on FMI, please visit www.fmiint.com.