Trelleborg and Nordic Capital in the Nordic region's largest Private Equity trans
Trelleborg and Nordic Capital in the Nordic region's largest Private Equity transaction * Nordic Capital acquires a majority stake in Ahlsell, Bröderna Edstrand, Starckjohann and Reynolds * The four companies will be developed individually * Total turnover for the companies is approximately SEK 15 billon * 4,300 employees * Total transaction value of SEK 6.5 billion Nordic Capital has today signed an agreement with the Trelleborg Group to ac- quire 51% of the shares in Ahlsell, Bröderna Edstrand, Starckjohann and Rey- nolds at a total debt-free value of SEK 6.5 billion. Starckjohann includes the building materials wholesaler Starkki which will be developed as a separate 1 unit. Starckjohann's HVPAC activities, Suomen LVI Tukku, will be integrated with Ahlsell, while the steel wholesaler Starckjohann Steel will be a part of the new Bröderna Edstrand Group. Together the four companies have an annual turnover of approximately SEK 15 billion. The management teams of the four companies will at a later stage be offered ownership participation. The sale of 51% is expected to give Trelleborg a capital gain before tax of SEK 900 million. Fredrik Arp, President and CEO of Trelleborg AB "This divestiture is a good transaction for us from a value perspective and corresponds well with our core business concentration process. Furthermore, the transaction gives us the possibility to focus our internal resources on expansion of the Industrial sector, where we see substantial potential. The divestiture gives us a sizeable income addition. In addition, we will get a continuous income contribution from our minority holding in the businesses and further contributions in connection with final divestitures in the future. These components together with a considerable cash contribution will have positive effects on earnings per share in the future". Robert Andreen, Managing Director, Nordic Capital: "Nordic Capital invests in four very well managed companies with highly quali- fied management teams. The acquisitions fit with Nordic Capital's investment philosophy of making investments in industries currently undergoing restruc- turing. We see many future development opportunities for the companies. Ahlsell will expand their successful concept to Norway and Denmark through strategic acquisitions and greenfield investments. The aim is to go from being the leading HVPAC and electrical wholesaler in Sweden to being the leader in the entire Nordic region. Bröderna Edstrand will continue to strengthen its market position market as an independent actor through continued investments in its ability to meet the de- mand for pre-treated input materials from construction and engineering indus- tries. Starkki has during the last few years developed an effective concept for both professional and private customers. Nordic Capital believes that Starkki has a good opportunity over the next few years to develop into the leading building materials wholesaler chain in Finland. Nordic Capital's ambition is an IPO within 2-5 years for several of the compa- nies. For the employees, this transaction implies no direct changes. The strategy for the companies is to become even more aggressive in their respec- tive markets". Ahlsell is one of the leading HVPAC and electrical wholesalers on the Swedish market. With the addition of Suomen LVI Tukku, Ahlsell will also gain an im- portant position on the Finnish market. The company also has growing positions in the Danish and Norwegian markets. The new Ahlsell group will have an annual 1 Heating, Ventilation, Plumbing and Air Conditioning turnover of approximately SEK 7 billion and 2,100 employees, of which Suomen LVI Tukku accounts for approximately SEK 1.2 billion and 240 employees. Bröderna Edstrand is the largest supplier-independent wholesaler of steel and aluminum in Sweden. With the integration of Starckjohann Steel's Finnish busi- ness, the new Bröderna Edstrand group will also become the largest supplier- independent wholesaler of steel and aluminum in Europe. The new group will have an annual turnover of approximately SEK 4 billion and 770 employees, of which Starckjohann Steel accounts for approximately SEK 1.3 billion and 320 employees. Starkki is the second largest building materials wholesaler chain in Finland with 17 outlets. The Starkki concept targets both professionals and private customers. Starkki has an annual turnover of approximately SEK 3 billion and 890 employees. Reynolds is a supplier-independent wholesaler of aluminum, copper and brass products with activities in France, the U.K. and Germany. The customers are mainly active in the construction and engineering industries. Reynolds will have an annual turnover of approximately SEK 1 billion and 190 employees Nordic Capital is a leading private equity firm in the Nordic region and has since 1990, including these transactions, made 31 acquisitions with a total turnover of approximately SEK 50 billion. Among the acquired companies are Nycomed Pharma, Wilson Logistics, Mölnlycke Health Care, Fritidsresegruppen, BT Industries and Intentia. Nordic Capital's primary investment philosophy is to focus on industrial re-structuring situations together with the present management teams. In more than half of Nordic Capital's acquisitions, the seller has decided to remain as joint owner. Investors in Nordic Capital's fund are a number of well-known Nordic, U.S. and U.K. institutions. The deal is subject to the approval of EU competition authorities and a final formal agreement regarding external financing. For further information, please contact: Trelleborg AB Nordic Capital Fredrik Arp, President and Robert Andreen, CEO CEO Tel: +46 8 440 50 50 Tel: +46 410 670 26 Mob: +46 70 511 94 00 Mikael Byström, Investor www.nordiccapital.se Relations Tel: +46 410 670 37 Mob: +46 708 552 169 www.trelleborg.com ------------------------------------------------------------ Please visit http://www.bit.se for further information The following files are available for download: http://www.bit.se/bitonline/1999/11/12/19991112BIT00060/bit0001.doc http://www.bit.se/bitonline/1999/11/12/19991112BIT00060/bit0002.pdf