VR Equitypartner and SuedBG exit Duo Plast in SBO

Katharine Hidalgo
05 July 2019

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VR Equitypartner and co-investor Süd Beteiligungen (SuedBG) have sold their majority stake in Duo Plast to Paragon Partners.

Paragon drew equity from its €412m vehicle, Paragon Partners Fund II, which held its final close in 2014. Typical transaction values for the fund are between €30-150m.

Paragon is currently in the market with Paragon Partners Fund III, which has a target size of €700m and is understood to have held a first close earlier this year. In has not yet made any investments.

The vendors launched a sales process for the company in April 2019.

The management team has retained a stake in the company and will continue to lead it.

Throughout the investors' holding period, the company professionalised a number of processes, invested in development and production, and continued its internationalisation strategy.

Debt will be provided by two or three Germany-based banks.

The company is expected to generate almost €60m in revenues per year and EBITDA of €9-10m, according to reports by Unquote sister publication Mergermarket. The company expected EBITDA of €8.4m for 2018, up from €8m in 2017, and €7m in 2016.

Previous funding
In 2013, SuedBG and VR Equitypartner acquired a majority stake in the company as part of a succession agreement. The founder – and previously the sole shareholder – Norbert Jäger joined the supervisory board as part of the transaction.

Company
Founded in 1983, Duo Plast manufactures packaging and stretch film. Headquartered in Lauterbach, the company operates products and sales sites in Thuringia, Austria, France and Turkey. It employs 150 people.

People
VR Equitypartner – Christian Futterlieb (managing director).
Duo Plast – Erich Steiner (CEO).

Advisers
Vendor – William Blair International (M&A); PwC (financial due diligence, commercial due diligence, tax); McDermott Will & Emery (legal); ERM (environmental due diligence).