Ace buys Astorg's Aries Alliance, injects €20m in new money

The deal is the first for the aerospace-focused Ace Aero Partenaires fund, which reached a €630m first close in July. The fund is targeting €1bn and is backed by institutional investors, aerospace corporates and the French state. The initiative was announced in June by the French Finance Ministry. It aims to support, reorganise and ultimately strengthen the aerospace supply chain, currently badly affected by the coronavirus pandemic.

The impact of the crisis led Aries to pursue a restructuring, having entered a safeguard procedure in September, according to French daily Les Echos. The company is aiming for a €50m turnover this year, compared with €100m in 2019.

"Despite the external difficulties brought on by the coronavirus pandemic," Ace Management managing partner Guillaume Benhamou told Unquote, "Aries benefits from strong technological and industrial fundamentals, in a niche market segment that is very important to the wider aerospace industry."

Ace stated it could invest up to €20m in Aries. It will partner with Aries CEO Jean-Laurent Donato and chair Eric Guyon. Astorg has now fully exited the business, the GP told Unquote.

Donato joined the company in 2019 as it was already experiencing operational difficulties, Benhamou said: "The performance was already starting to improve under this new management, but unfortunately the coronavirus situation halted that progress. Beyond capital, we aim to offer hands-on support to the management team to pursue these efforts. We will soon sit down with the team to learn from the past few months and draw up a roadmap to bolster the business."

In a statement, Aries said it would aim to ensure service continuity for its customers in these challenging times, while adapting its structure to the medium-term market perspectives. It expects its restructure to be completed by the end of the year.

Benhamou said Ace and Aries will continue discussions with the company's banking partners to ensure continued support as it adapts to the new market landscape.

Astorg (which bought the business in 2018) was mounting its own bid to rescue the business, aiming to partner with turnaround fund Arcole. Guyon and Donato were opposed to the plan and in favour of Ace's bid, leading to them being removed as managers over the summer, according to the aforementioned Les Echos report. Ace reinstated the duo following its successful bid.

Aries subsidiary Dufieux, a French designer and builder of large-capacity machine-tools for milling, pocketing and high-speed applications for the aeronautic sector, went into receivership in September. It was not included in the transaction with Ace, Benhamou said.

Previous funding
In 2018, Astorg acquired a majority stake in Aries Alliance, a manufacturer of machine tools, titanium wing structures and engine parts for the aerospace sector, for less than €300m. CEO Eric Guyon and management retained a substantial minority in the business.

As part of the transaction, previous backers including family holding company Phoenix, CM-CIC Investissement, BNP Paribas Développement and Ace Management exited their investments.

Astorg drew capital from the €2.1bn Astorg VI fund to finance the deal. The transaction was supported by senior debt amounting to €80m, with A and B tranches provided by banks BNP Paribas, Banque Populaire du Grand Ouest, LCL and Societe Generale.

Company
Aries was created from the spin-out of Alstom's metal forming activities in 2000. It specialises in manufacturing machines and presses along with complex mechanical parts for aircraft engines, helicopters and launchers for the civil aviation and aerospace industries. Clients include Airbus, Safran, Dassault Aviation, Rolls Royce, Boeing, Spirit, Kawasaki and Mitsubishi Motors.

Headquartered in Nantes, Aries employs 190 people and operates two production sites in Nantes (France) and Monroe (North Carolina, US).

At the time of the 2018 buyout, it employed 350 people and generated turnover of €130m.

People
Ace Management – Guillaume Benhamou (managing partner); Delphine Dinard (partner); Olivia Ver Hulst (associate); Maréva Fréjean (general counsel).
Aries Alliance – Eric Guyon (chair); Jean-Laurent Donato (CEO); François van Wessem (CFO).

Advisers
Equity – DC Advisory, David Benin, Alban Collin du Bocage, Yann Vila (M&A); Weil Gotshal & Manges, Anne-Sophie Noury, Camille Bretagne, Jean Beauchataud, Guillaume Bonnard (legal, tax); Rineau Associés, Bernard Rineau (legal, tax); EY, Gratien de Pontville, François Estin, Gilles Marcadier, Boris Valet (financial due diligence).
Company – PLM Avocats, Patricia Le Marchand, Morgane Michel (legal); Opleo, Pierre-Olivier Bernard, Sandrine Gardel, Antoine Degorce (legal); 8 Advisory, Bertrand Perette, Damien Petillon (financial due diligence).

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Send to  

• Topics
• Buyouts
• Exits
• Turnaround/Special Situations
• Industrials
• France
• ACE Management
• Astorg Partners
• Secondary buyout
• Turnarounds