Equistone sells Kermel to Qualium

Argos Soditic, which owned Kermel before selling it to Equistone in 2007 but kept a 10% stake in the business, fully exited as well. The company's management will retain a minority share in Kermel.

Qualium usually invests €20-75m in businesses valued in the €40-250m range.

Debt
AXA Private Equity and IFE provided mezzanine financing for the transaction.

Previous funding
Equistone (then Barclays Private Equity) acquired a majority stake in the secondary buyout of Kermel in 2007. Argos Soditic, which generated a money multiple of 12x and an IRR of around 80% on the sale, re-invested in the newco to retain approximately 10% of the equity. Management increased its stake in the business. CIC and BNP Paribas underwrote the two-tranche senior debt package, with CIC providing 60% of the debt while BNP underwrote 40%.

Under Equistone's ownership, production capacity increased by 50% while EBIT doubled. Its turnover generated in North America also doubled.

Company
With roots dating back to the 1960s, Kermel is a manufacturer of meta-aramid fibres for protective clothing and industrial applications. The company is active on three main markets: fire services, military & public order and industrial.

Kermel posted a €37.5m turnover (two thirds of which were generated outside of France) and a €10m EBITDA in 2011.

People
Boris Podevin, Cyprien Choutet and Julie Khayat led the deal for Qualium. Equistone was represented by Guillaume Jacqueau, Julie Lorin and Grégoire Schlumberger. Cédric Bruix represented Argos Soditic.

Advisers
Equity – Gimar Finance, Chantal Toulas (M&A); Paul Hastings, Olivier Deren, Pascal de Moidrey, Arnaud Levasseur, Mounir Letayf (Legal); Eight Advisory, Justin Welstead, Cyrille Palitzyne (Financial due diligence); Gherzi, Giuseppe Gherzi, Laurent Aucouturier (Commercial due diligence); Alcimed, Florent Surugue, Rémi Masson Regnault (Commercial due diligence); ERM, Julien Famy, Edouard Buffière (Environmental due diligence); Marsh, Jean-Marie Dargaignaratz (Insurance due diligence); Exfi Partners, Emmanuel Parmentier (ESG due diligence).
Vendors – BNP Paribas Corporate Finance, Virginie Scotto, Sylvina Mayer, Bruno Attali (M&A); HPML, Vincent Libaud, Velin Valev (Legal); Deloitte, Jean-Philippe Grosmaitre, Victor Chemineau (Financial due diligence); URS, Lucie Choffey (Environmental due diligence).
Debt – SJ Berwin, Olivier Vermeulen (Legal).
Management – Callisto, Eric Delorme, Paul-François Lorenzoni (M&A); Hoche, Jean-Luc Blein (Legal).

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• Topics
• France
• Buyouts
• Exits
• Industrials
• France
• Equistone Partners Europe
• Secondary buyout
• Axa Private Equity