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Bregal kickstarts ATP sale process; Morgan Stanley advises

  • Johannes Koch, Joao Grando, Min Ho and Amy-Jo Crowley
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Bregal has hired Morgan Stanley to oversee a process to sell its Swiss industrial adhesives business ATP Adhesives Systems after only two years since acquiring it, four sources familiar with the situation have said.

The tapes specialist is expected to generate EBITDA of EUR 45m from EUR 175m in sales this year, the first three sources said. Information memorandums will be distributed shortly, the sources said.

ATP's EBITDA contains two add-ons, two sources said. The add-ons did not boost EBITDA much, but were strategically key to move ATP's products into the medical technology space and for it to gain a foothold in the US, one source noted.

ATP acquired UK-based specialised adhesive tape converter BDK Industrial Products in March this year followed by Coating & Converting Technologies in Philadelphia earlier this month.

Trade and private equity firms are keen on ATP's ESG profile, in particular its environmental credentials with its water-based adhesive technology that leads to an overall reduction in Co2, the first two sources said. The water-based adhesive technology is not as toxic as the more traditional chemical-based solvents, and it reduces both production process energy intensity and raw material costs, they added.

"In the end, it's just cheaper than chemical-based solvents, using 70% less raw material with the same, if not better, performance of the adhesives, which is the real USP of ATP," one source said.

ATP could be of interest to sponsors with experience in the adhesives market such as OpenGate Capital, which has speciality tapes business Duraco in its portfolio; or Astorg with IGM Resins, a coatings business with an adhesives product line, the second source said.

Bregal acquired a majority share in ATP as part of a succession plan in February 2019.

Founded in 1988, ATP has 280 employees and is headquartered in Wollerau, Switzerland, producing a range of industrial adhesive tapes for automotive, construction, healthcare, graphics and electronics industries.

Bregal and Astorg declined to comment. Morgan Stanley and OpenGate did not respond to a request for comment.

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