3i reaps £52m on partial sale of Eltel shares

Katharina Semke
26 February 2016

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3i has earned ТЃ52m through the sale of 7.7 million shares in Eltel, a Finnish technical services company that was floated in February 2015.

The total proceeds for 3i were £52m, with the listed entity reaping £30m and the funds earning the remainder. The deal saw 3i and funds managed by the GP reduce their stake from 20.0% to 7.6%.

The listed GP's remaining stake of 4.3% is valued at £18m – adding the stake retained by funds managed by 3i push that figure to £33m. The shares were sold at an average price of SEK 80.50 per share.

Eltel listed on the Stockholm Stock Exchange at SEK 68 per share in February 2015. 3i earned £76m in the IPO, which valued the company at nearly SEK 4.26bn. The total money raised was SEK 2.5bn, with existing shareholders selling 17.2 million.

Ahead of the flotation, 3i held 62.6% of Eltel and was the second-largest shareholder. BNP Paribas held 29.5%, with management holding the balance. 3i retained a 14.3% stake after the IPO, which saw Eltel refinance senior loans held by 3i and funds managed by the GP.

Shortly after the flotation, 3i sold £10m of additional shares in Eltel as part of the IPO's overallotment option. The option comprised 3.3 million shares; this brings 3i's total proceeds from Eltel's listing to £86m. The exercise of the option brought the combined stake of 3i and other investors down to 20%.

Previous funding
3i bought Eltel from IK Investment Partners and Nordic telecoms company TeliaSonera in a 2007 deal that saw IK reap a 2.5x money multiple.

IK's Industri Kapital 2000 Fund had acquired the company from CapMan three years prior, paying €190m.

Company
Eltel is a provider of technical services to the European infranet industry, which consist of companies that own and operate critical infrastructure networks including power, communication, transport and defence.

Headquartered in Espoo, Finland, the company also offers services related to the construction, installation, maintenance and operation of critical infrastructure.
It mainly operates throughout the Nordic and Baltic regions, Poland, Germany, the UK and Africa.

Eltel generates net sales of €1.15bn and reports EBITDA of €52m. Founded in 2001, the company employs 9,300 people.

People
3i – Fredrik Karlsson (partner and co-head for the Nordic region).
Eltel – Axel Hjärne (CEO).