VR Equitypartner sells Megabad stake to FSN Capital

FSN is investing alongside Megabad's management, and intends to support the company in its growth initiatives and its founder transition, the GP said in a statement.

The GP is deploying equity via FSN Capital VI, which held a final close in June 2021 on €1.8bn, less than one year after its launch in July 2020. The fund continues FSN's strategy of backing manufacturing, consumer and business services companies. The preceding fund, FSN V, deployed equity tickets of €30-130m with a sweet spot of €50-60m.

Megabad is the fund's third platform investment and the vehicle will be 20% deployed following the deal.

VR Equitypartner acquired a minority stake in Megabad in August 2019. According to Unquote Data, the company reported an operating profit of €2.27m and EBITDA of around €2.52m in 2017.

During the investment period, VR Equitypartner assisted the company with the implementation of its succession solution plan, the GP said in a statement. This included hiring industry expert Harald Hotop as CEO.

Unquote sister publication Mergermarket reported in June 2021 that GCA Altium had been mandated to run a sale process for Megabad, noting that the company was to be marketed based on revenues of €180m and EBITDA of €18m. A source close to the situation confirmed to Unquote that these figures correspond to Megabad's predicted 2021 revenues and EBITDA.

Company
Headquartered in Cologne, Megabad was founded in 1932 and was previously known as Gottfried Stiller. The company sells bathroom fittings, furniture and accessories, including baths, bathroom ceramics, mirrors and shower trays. It launched its online sales channel in 2003 and was the first e-commerce site for sanitary products in Germany at the time, according to a statement. The company sells its own products as well as branded goods, serving both B2C and B2B channels. Megabad employs 220 staff.

People
VR Equitypartner – Christian Futterlieb (managing director); Tim Feld (member of the management); Hedwig Holkenbrink (investment director); Hendrik Hornbogen (investment manger); Jens Schöffel (head of risk and portfolio management); Jens Osthoff (director).
FSN Capital – Justin Kent (partner).
Megabad – Stefan Stiller (founder); Harald Hotop (CEO).

Advisers
Equity – Corporate Finance Mittelstandsberatung (corporate finance); EY (financial due diligence); Norton Rose Fulbright (legal); Alvarez & Marsal (commercial due diligence); PwC (tax); Valearis (IT due diligence); Frank Partners (risk due diligence); Marsh (insurance due diligence).
Vendor – GCA Altium, Tobias Schultheiss, Mathias Heymann, Moritz von Bodman (M&A); Latham & Watkins (legal); KPMG (financial due diligence); Ommax (commercial due diligence).

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• Topics
• Buyouts
• Exits
• DACH
• Consumer
• Germany
• Secondary purchase
• FSN Capital