IK sells SVT Group to Ergon Capital

The sale generated a 5x money multiple for IK and an IRR of 95%, according to a source close to the situation.

SVT was marketed at €13m EBITDA from €114m revenues for 2017, according to a second source.

Ergon drew capital from its 2010-vintage €775m buyout fund, Ergon Capital Partners III, to support the transaction.

IK made the divestment from IK Small Cap I Fund. SVT was the first investment made by the €277m vehicle, shortly before its first close in June 2015.

Under IK's ownership SVT has expanded its workforce from 322 to 450 employees and, revenues have increased from €80m to €114m.

The GP said it invested significant resources into research and product development, resulting in the company obtaining a number of licences from the international regulatory body for the industry, which enabled further internationalisation of products.

Debt
Senior leverage was expected to be in the range of 4.5x with funds pitching up to 6x through unitranche, according to unquote" sister publication Debtwire. The buyer declined to comment on the deal's financing.

Previous funding
Capiton and private investment company CFH backed the first management buyout of SVT in August 2008. At the time, the company employed 240 people and generated €67m in sales.

IK backed the secondary buyout in June 2015. The headcount had increased from 240 to 322 under Capiton's ownership, and revenues had increased to €80m.

Company
Founded in 1969 and headquartered in Seevetal, near Hamburg, SVT is a provider of preventive passive fire protection products and installation management services. It also provides restoration management, specialising in fire, water and natural hazard damage restoration.

The firm employs 450 people and operates 32 branches in Germany, with additional support from subsidiaries in Singapore, Dubai and Poland. It projected €13m in EBITDA from €114m in revenues for 2017.

People
Ergon Capital Partners – Wolfgang de Limburg (managing partner); Nils Lüssem (partner).
IK Investment Partners – Anders Petersson (partner).
SVT Group – Steffen Gerdau (chief financial officer).

Advisers
Acquirer – Alantra (M&A); Latham & Watkins (legal); Alvarez & Marsal (commercial due diligence).
Vendor – Goetzpartners (commercial due diligence); Ebner Stolz (financial due diligence); Renzenbrink (legal); Golder Associates (ESG due diligence).

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• Topics
• Buyouts
• DACH
• Industrials
• Germany
• Secondary buyout
• IK Investment Partners