IK seals Cérélia Group SBO from Sagard

Cérélia's enterprise value has yet to be disclosed, but IK typically targets companies valued in the €100-400m range.

The transaction, subject to regulatory approval, was leveraged at around 55%.

Members of the management board including CEO Guillaume Reveilhac, Alain Caspar and Gabriel Cravero re-invested 70% of their proceeds from the sale to secure the remaining 33.3% of the business.

According to IK, there is a possibility additional minority shareholders may enter the business's capital structure at a later point, although the firm expects to remain a majority shareholder. 

IK's negotiations with Sagard began during the second half of April, but the buyer had worked on commercial due diligence with Bain & Co ahead of the talks. Cérélia was identified as a potential target two years ago, according to IK, as the house considered acquisitions in the food sector, a space where it has completed a dozen purchases to date.

IK now plans to support the company in maintaining the growth it has experienced under Sagard's ownership and diversifying Cérélia's operations. According to the business's new owner, there are plans to expand internationally with a long target list of bolt-ons currently under consideration.

The transaction, sealed on 4 May 2015, was financed via IK's VII fund. Announced in December 2011, the vehicle raised €1.4bn when it reached a final close in October 2013 – €300m short of its initial €1.7bn target.

Prior to Cérélia, IK VII was used for the DKK 700-800m joint acquisition of Danish gourmet food businesses Meyes and Løgismose in November 2014 and the purchase of German conveyor belt manufacturer Transnorm Beteiligungen, among other deals.

Debt
The transaction was financed by a senior debt package arranged by Societe Generale and CIC.

Previous funding
The transaction saw Sagard divest Cérélia after less than three years of ownership. The group was created by the GP through the merger of dough manufacturers Alsacienne de Pâtes Ménagères (APM) and Eurodough in December 2012.

Having been shareholders in APM since July 2010, Capzanine, Céréa Capital and BNP Développement rolled over their stakes into the newco following the merger and became significant minority shareholders in the business, according to IK.

Eurodough had acquired up by Sagard a year earlier, when the GP invested €115m via its second fund to acquire a majority stake in the business from parent Sara Lee Group.

At the time, Sagard stated it had been attracted by Eurodough's growth potential as a standalone business and announced bolt-on acquisitions would be considered in the following years. During the firm's tenure, Cérélia claims to have seen its turnover increase from €130m in 2012 to the €212m most recently reported – 40% of which came from exports to Italy, Spain, Germany and the Nordic region, among others.

Company
Headquartered in Liévin, Cérélia is a manufacturer of ready-to-bake dough. Currently operating five production plants in France, the business sells its products in 15 countries including Italy, Spain and the Nordic region. Employing a workforce of 650, Cérélia most recently posted a turnover of €212m.

People
Partners Rémi Buttiaux, Dan Soudry, associate director Diki Korniloff and associate Thibaut Richard led the deal for IK Investment Partners, while Sagard was represented by partners Antoine Ernoult-Dairaine and Saïk Paugam, as well as manager Maxime Baudry. Guillaume Réveilhac is CEO of Cérélia Group.

Advisers
Equity – JP Morgan, Edouard Debost (Corporate finance); Bain & Cie, Jean-Marc Le Roux, Daphne Vattier, Doris Galan, Andrea Gondekova, Guillaume Despagne (Commercial due diligence), E&Y, Daniel Benquis, Christophe Ringuier (Financial due diligence); Willkie Farr & Gallagher, Eduardo Fernandez, Gregory De Saxce, Elise Carrera, Virginie Sayag, Paul Lombard, Stanislas Curien, Philippe Grude (Legal).
Vendor – Rothschild & Cie, Laurent Baril, Charles Mussat, Thomas Denizeau (Corporate finance); AT Kearney, Jérôme Souied, Hugo Azerad (Commercial due diligence); PwC Ts, Katia Carow, Guillaume Lorain (Financial due diligence); Bredin Prat, Olivier Assant, Barthélemy Courteault, Samuel Pariente (Legal).
Company – King & Wood Mallesons, Jérôme Jouhanneaud (Legal).

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• Topics
• France
• Buyouts
• Exits
• Consumer
• France
• Secondary buyout
• Sagard Private Equity
• IK Investment Partners