Advent buys part of Oberthur for €1.15bn

The buyout house will invest via the GPE VI fund, which closed on €6.6bn in 2008. Oberthur's founder Jean-Pierre Savare and his family will retain a 10% stake in the business following the sale.

Initially a money printer, Levallois-Perret-based Oberthur later diversified into the smart cards and secure identity documents markets. This divestment would allow it to focus solely on its printing business, as its takeover offer for rival money printer De La Rue was rejected in December 2010.

Advent has been looking at the sector for several years, and seized the opportunity to invest when the Card Systems and Identity divisions went up for sale a few months ago.

Other PE firms rumoured to have been bidding in the Rothschild-run auction process included PAI partners, Bain Capital and One Equity. Among other considerations, Advent was able to leverage its experience in the electronic payment sector to secure the deal – the firm's portfolio notably includes RBS Worldpay in the UK, Fifth Third in the US and Cetip in Brazil.

Advent believes the company will be able to benefit from very favourable growth drivers, including the rapid development of the EMV payment technology as well as growing opportunities in the mobile payment market.

The PE house also intends to foster the company's growth through select add-on acquisitions, which will allow Oberthur Card Systems/Identity to target additional countries and diversify its offering.

Debt
Barclays, Lloyds and Royal Bank of Canada arranged a 4.5x EBITDA, all-senior debt package to finance the transaction.

Company
Oberthur Card Systems provides security and identification solutions based on smart card technologies for the mobile, payment, transport, digital TV and convergence markets. Oberthur Identity specialises in the manufacture of traditional and electronic secure identity documents. The two divisions employ a combined 5,400 staff and will continue to operate autonomously.

The entire Oberthur group posted a €979m turnover for 2010 – its smart cards against identity document activities accounted for 73% and 10.4% of these revenues respectively.

People
Pascal Stefani and Cédric Chateau led the deal for Advent. Jean-Pierre Savare is president of Oberthur.

Advisers
Equity – HSBC, Gilles Collombin, Pierre-Emmanuel Houillier (M&A); Weil Gotshal & Manges, Jean Beauchataud, Grégoire Andrieux (Legal); Marlborough Partners, Romain Cattet, David Parker (Corporate finance); KPMG, Florent Steck, Guy Hands (Financial due diligence); Bain & Co, Jérôme Brunet, Grégory Garnier (Commercial due diligence); TAJ, Ariane Chateaux, Malik Douaoui, Jerome Gertler (Legal, tax); Marsh, Humbert d'Autichamps (Insurance due diligence); ERM, Julien Famy (Environmental due diligence).
Vendor – Rothschild, Cyrille Harfouche, Guillaume Vigneras (M&A); White & Case, Hughes Mathez, Natalie Negre-Evillard (Legal); Landwell, Rémi Montredon, Cecile Debin (Legal, tax); Ernst & Young, Gilles Marchadier, Anne Fabre (Financial due diligence).

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• Topics
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