CVC sells Linxens to trade in $2.6bn deal

Francesca Veronesi
26 July 2018

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CVC Capital Partners has signed an agreement with Unisplendour, a Chinese IT company, to sell French smartcard parts maker Linxens.

The valuation reported by press reports in the €2.2bn range is roughly correct, a person familiar with the situation told Unquote.

Unisplendour is a listed subsidiary of China-based Tsinghua Unigroup. Founded in 1988, Tsinghua Unigroup develops and markets wireless systems-on-chip and radio-frequency semiconductors for cellular and broadcast applications.

Previous funding
Astorg acquired the business, formerly known as Microconnections, in a carve-out transaction in 2011. The business was bought from FCI, a portfolio company of Bain Capital since 2005. The transaction, valued at €600m, was supported by a €320m debt package from Goldman Sachs, Nomura and RBC.

Subsequently CVC Capital Partners acquired Linxens from Astorg Partners in 2015. At the time of the transaction, market sources valued it around the €1.5bn mark.

CVC used its €10.9bn CVC Capital Partners VI, which held a final close in 2013. It was reported that banks lined up €1bn of debt to finance the deal - approximately 6-7x the group's estimated EBITDA. Credit Suisse, Deutsche Bank, HSBC and Nomura Bank provided debt to support the transaction.

Company
Linxens is a smartcard-connector manufacturer, targeting clients within the consumer and industrial electronics, automotive and telecommunication infrastructures markets. Headquartered in Levallois Perret, the business operates eight production sites in Asia, Europe and North America and four R&D centres, employing around 3,000 people. The company reported a turnover of €535m for 2016.

Established in 1982 as MCTS, the business was renamed FCI Microelectronics in 1999. A second rebranding took place in October 2011, when the company became Linxens after it was acquired by Astorg.

People
CVC - Edouard Conques (director).
Linxens - Christophe Duverne (president, CEO).
Unisplendor - Peng Qin (CEO, vice president).