Deal in focus: Greenbriar shops in France with WFCI

The deal saw Greenbriar secure a majority stake in the company. The GP invested via its third vehicle, which closed on $1.1bn in June last year. Pierre Brunet, the founder and hitherto majority shareholder of the business, sold part of his shares while staying at the helm of WFCI.

All parties declined to comment on financial details of the transaction. Although an enterprise value of €130m was mentioned in the French press following the deal, the transaction is understood to have valued WFCI in excess of this.

IDI and ActoMezz both invested €20m in a secondary buyout of WFCI in 2008. The investors secured around 30% of the company between them via a capital and mezzanine debt package, which also included a €20m mezzanine facility provided by Ardian. The management team, led by Brunet, reinvested and upped their majority stake from 51% to 70%. The company had an enterprise value of around €100m at the time, according to unquote" data.

IDI and ActoMezz were joined by 3i in 2011 in a further €33m investment to finance the purchase of competitor Kales. As part of the transaction, 3i provided €25m and secured a minority stake, while Brunet and the management retained a majority stake.

Given the US fund's specific focus on the transportation and logistics industries, 3i had already identified Greenbriar as a potential acquirer for the company. Direct contact was established in July 2014 during a conference in the US, with 3i's New York office facilitating the transatlantic negotiations.

WFCI's backers were initially keen on pursuing a refinancing for the business – a plan motivated by the possibility to secure less expensive facilities compared to those arranged at the time of the 2008 buyout. The mezzanine component in particular, with a 14% rate, was deemed to be particularly expensive.

According to 3i director Guillaume Basquin, pursuing both scenarios in parallel – a potential refinancing or a straight sale – enabled the vendors to negotiate a favourable valuation with Greenbriar, at which point negotiations progressed quickly.

Established in 2004, Paris-based WFCI operates as a general sales and services agent for freighter cargo in the aviation industry. The company generates revenues via commissions on the value of the cargo transported.

Fit for unitranche
Since the 2008 buyout, WFCI has completed five bolt-ons in Europe, the US and Asia. As a result of this strategy, the company now operates out of 180 offices in 60 countries, compared with 53 locations in 26 countries in 2011. Turnover increased from €450m in 2008 to around €1bn in 2014, with EBITDA believed to sit in the €15–20m range.

The business is highly cyclical though, according to Basquin – following the 2008 buyout, EBITDA was halved in 2009 as the financial crisis hit and significantly reduced global freight volume. But profits tripled in the following year as activity regained its footing.

The debt put in place by Greenbriar to finance the new deal reflects this cyclical factor, as well as WFCI's future expansion plans: the GP opted for a unitranche facility provided by Ares and Avenue Capital, which is understood to amount to around 4–5x the company's EBITDA.

People
Greenbriar Equity Group – Noah Roy
3i – Guillaume Basquin, Rémi Carnimolla, Anne Leforestier
IDI – Marco de Alfaro, Alexis Garand-Clavel
ActoMezz – Stéphane Bergez, Arnaud Faure

Advisers
Vendors – EY, Gratien de Pontville, Stéphane Vignals, Benjamin Zowczak (Financial due diligence); LEK, Rémy Ossmann, David Danon-Boileau, Nohmie Ben Rekassa (Commercial due diligence); Weil, Gotshal & Manges, Jean Beauchataud, Gautier Elies, Edouard de Lamy, Doriane Salimon (Legal); Cabinet Degroux-Brugère, Dominique Dumas (Legal).
Company – Marlborough Partners, Romain Cattet, JP Davidson, Francis Booth (Debt advisory).

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