3i buys majority stake in GartenHaus

Harriet Matthews
23 September 2020

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3i has acquired a majority stake in Germany-headquartered GartenHaus, an online retailer of garden houses and sheds.

The GP invested £60m in the business, while the GartenHaus management and board will also invest.

3i has not raised any additional debt for the buyout, but the company's existing debt facility arranged by Landesbank Baden-Württemberg has been rolled over.

According to a statement, 3i plans to expand GartenHaus's product offering into adjacent categories and to expand internationally into countries including the UK, France and the Netherlands, as well as to the Nordic region. The company also expects to benefit from the increasing popularity of gardening and leisure sector products.

3i generally invests in companies with enterprise values of €100-500m and usually holds investments for three to five years.

Many gardening-related businesses have thrived during the coronavirus pandemic. Kester Capital announced the refinancing of portfolio company YouGarden, a gardening products retailer, in August 2020, backed by incumbent bank Santander. YouGarden's EBITDA has doubled since Kester invested in October 2019 and the refinancing generated returns of 60% cost to the fund's investors.

Company
GartenHaus is an e-commerce company selling garden houses, sheds, carports, terraces and saunas. It supplies third party and private label brands, and launched its online shop in 2009. The company also provides services including consultation, planning permission assistance, foundation laying and maintenance.

Founded in 2002, the company is based in Hamburg and has 75 employees. It expects to see growth of 10% in the coming years. It reported sales of €30m in 2019, representing an increase of 25% compared with its 2018 revenues.

People
3i – Peter Wirtz (partner).
GartenHaus – Sebastian Arendt (CEO).

Advisers
Equity – Carlsquare (corporate finance); PwC (financial due diligence); Hengeler Müller (legal); Intargia (IT due diligence); EY (commercial due diligence); Taxess (tax).
Vendor – GCA Altium (corporate finance).