CVC sells Ista to Cheung Kong Property for €4.5bn EV

Oscar Geen
28 July 2017

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CVC Capital Partners has sold its stake in German energy management services company Ista to Cheung Kong Property Holdings (CKPH) for an enterprise value of €4.5bn.

The acquirer is entering into a joint venture with CK Infrastructure Holdings (CKI). According to the agreement document, the JV will pay a purchase price of €3.7bn to the seller. The remaining amount will consist of €350m in senior secured notes and €525m in senior subordinated notes.

Ista generated a €370m EBITDA from €850m in sales in 2016 and adjusted EBITDA of €105.4m for the first quarter of 2017. It was attracting leverage pitches of around 7x, comprising a mix of loans and bonds, according to unquote" sister publication Debtwire.

After the transaction, CKPH will hold 65% and CKI will hold 35% of Ista's equity, meaning a maximum commitment of €2.925bn and €1.575bn respectively.

The deal contains a break-fee clause of €200m payable by the acquirer to CVC if any clearances are not obtained prior to the closing of the deal.

The sale ends a four-year holding period for CVC, which purchased the company in an estimated €3.1bn buyout in April 2013, drawing €1bn from CVC European Equity Partners V.

Debt
The company is issuing €350m of 5% senior secured notes due in 2020, and €525m of 6.875% senior subordinated notes due in 2021.

Previous funding
CVC originally bought Ista in2003 from energy company Viterra Energy Services, a subsidiary of E.ON group, for an enterprise value of €880m, drawing capital from its third fund.

It then sold the company to Charterhouse Capital Partners for an enterprise value of €2.4bn in April 2007.

CVC bought the company back from Charterhouse for €3.1bn in April 2013, drawing equity from its fifth fund.

Company
Ista is an energy metering business founded in 1902 and based in Essen. The company offers services to property managers and owners as well as energy utilities ranging from the supply and installation of devices, to consumption metering as well as the billing and analysis of energy data. The business also develops energy management systems. It operates in 24 countries and employs around 5,400 people.

People
CVC Capital Partners – Marc Strobel (partner).
Ista – Thomas ZInnöcker (CEO).