Deal in Focus: Gilde and Parcom sell Bekaert Textiles to Haniel

Last year was a stellar 12 months for the Benelux exit landscape, as the region boasted more than 60 recorded divestments, according to unquote" figures. Gilde Buyout Parners and Parcom Capital could add to the tally in 2015, should their goal to divest Gamma Holding piecemeal bear fruit – with the recent sale of Bekaert Textiles to German family office Haniel marking the second step in that process.

Founded in 1892, the Belgian mattress producer is the second business unit to be carved out of parent group Gamma Holding, an industrial conglomerate in which Gilde and Parcom are shareholders, with another two companies remaining.

Headquartered in Waregem, Belgium, 35% of Bekaert's sales are made in Europe and 50% in the Americas, while it is also present in the Asia-Pacific region. The company reported more than €200m in turnover in 2014.

Gilde's involvement with Gamma began in June 2010, when the buyout house acquired a stake in the technical textile manufacturer from ASR Nederland, Delta Lloyd Asset Management and Allianz Nederland Levensverzekering in a €27.2m PIPE deal.

Investing via its Gilde Buyout III Fund, the mid-market player secured a 19% shareholding in the transaction, according to unquote" data. The stake was subsequently increased to almost 25% through further purchases.

Six months later, Gilde teamed up with Parcom to take Gamma Holdings private. The latter already held a 26% stake in the industrial conglomerate. The €429m take-private transaction valued the business's equity at €218m. Gilde invested once again from its Buy Out Fund III vehicle, while Parcom financed the deal via its Investment Fund I and Buyout Fund IV vehicles. Both firms held a combined 98.2% stake in Gamma as of 23 February 2011.

As part of the deal, Gamma Holding renegotiated its existing debt with ABN Amro, ING and Rabobank. The three lenders jointly provided three debt tranches valued at $125m, €70m and a €100m multicurrency package, according to a regulatory filing from the Netherlands Authority for the Financial Markets.

Four-way split
When Gilde and Parcom picked up Gamma Holding in 2010, the group comprised four business units: Clear Edge Filtration; Ammeraal Beltech; Dimension-Polyant; and Bekaert Textiles. In addition to these, the conglomerate also included Africa-focused fashion textiles producer Vlisco Group, which was sold to emerging markets firm Actis Capital for €116m prior to Gilde and Parcom's public offer.

According to market sources, at the time, Gilde was attracted by the conglomerate discount offered to potential acquirers. The buyout house judged Gamma's various divisions to lack real synergies due to the large, expensive central holding that kept them together.

According to Gilde, It was the firm's view that the value for the sum of the parts would surpass that of the conglomerate as a whole. This prompted a strategy to break the group into four separate entities that would be financially, legally, fiscally and strategically independent from one another.

As part of that roadmap, the GPs began to divest Gamma's business units in May 2013, when Tulsa-based industrial filtration devices manufacturer Clear Edge Filtration was sold to Chicago-based Filtration Group Corporation. The transaction allowed the industrial conglomerate to refinance an undisclosed portion of its existing debt.

Although Gilde and Parcom have yet to comment on further divestments in the pipeline, market sources recently revealed contact has been made with private equity firms and other players for the exit of Dutch process and conveyor belts manufacturer Ammeraal Beltech. These same sources place the value of the sale at 10x EBITDA, which amounted to €50m in the last financial year.

People
Gilde Buy Out Partners – Hein Ploegmakers, Maurits Boomsma, Boudewijn Molenaar, Robert Thole, Nicolas Linkens, Bernard Dierinck.

Advisers
Vendor – ING Bank (M&A); Rabobank (M&A); Clifford Chance (Legal).
Acquirer – De Brauw Blackstone Westbroek (Legal).

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• Topics
• Benelux
• Industrials
• Deal in focus
• Gilde Buy Out Partners
• Unq2015June