Klar Partners to acquire ISS Kanal Services

The deal is expected to close in Q2 2021.

Following the divestment, ISS intends to continue to focus on its core business of integrated facilities services and key accounts, according to a statement. The business intends to generate proceeds of DKK 2bn in 2021 and 2022 from its divestment programme.

Asked about how the deal came about, Carl Johan Falkenberg, partner at Klar, told Unquote: "Klar is a sector-driven investment firm focusing on mission-critical business services companies. We have followed the UIM sector and ISS Kanal for a long time and were well prepared when the company came up for sale."

"It's the first acquisition in Switzerland and the third investment overall from our debut fund," Falkenberg added. "This investment constitutes a significant milestone for Klar and highlights our strong local networks across Europe."

Klar held a final close for its debut fund in March 2021 on its hard-cap of €600m, as reported by Unquote. The fund invests in companies at the lower end of the mid-cap segment, focusing on B2B, mission-critical services and light industrial businesses in the Nordic, Benelux and DACH regions.

The GP is currently arranging financing to back the deal, Falkenberg said. "We are in discussions with a number of potential lenders to get the optimal financing for the company."

Klar intends to support the company's growth by strengthening its position in Switzerland and Europe, the GP said in a statement. Add-ons will also form part of the strategy, Falkenberg said. "The market is fragmented and we will be looking to explore both larger and smaller acquisitions to build the company."

Company
ISS Kanal provides UIM services for systems such as sewers, tunnels and recycling infrastructure, focusing on flushing, inspection, maintenance and repair. Its customers include both private clients and homeowners, as well as public organisations. Founded in 1967, the company employs 280 staff and is headquartered in Zurich. It generated sales of around CHF 50m in 2020.

People
Klar Partners – Carl Johan Falkenberg (partner); Florian Bandel (investment professional).
ISS Kanal Services – Urs Aschwanden (CEO).
ISS Schweiz – André Nauer (CEO).

Advisers
Equity – Latham & Watkins (legal); Walder Wyss (legal); Lazard (corporate finance); Ebner Stolz (financial due diligence).
Vendor – UBS (corporate finance); CMS (legal).

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