Axcel exits Netel to IK Investment Partners

Mikkel Stern-Peltz
03 June 2016

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Danish GP Axcel has exited Swedish telecommunications business Netel to IK Investment Partners in a secondary buyout.

A source close to the deal told unquote" the deal saw IK win out against competing bids, paying an entry multiple of approximately 5x EBITDA, with the GP leveraging the deal at around 3x with an all-senior package provided by Swedbank and SEB.

The deal sees IK tap its 2012-vintage €1.4bn IK VII fund for the equity, providing an exit for Axcel IV, which raised DKK 3.6bn in 2011.

IK partner Alireza Etemad told unquote" the GP had been in contact with management for a period of time before the deal, with Etemad himself having been aware of Netel for a long time, given his focus on the TMT sectors. Management will take a minority stake as part of the SBO, according to Etemad.

IK Investment Partners – recently the subject of an unquote" profile – will take over as majority shareholder from Axcel, which bought into the former subsidiary of Swedish construction and civil engineering group Peab in 2011. According to unquote" data, Netel generated revenues of SEK 465m when it was acquired by Axcel, growing to SEK 1.5bn in the last financial year, according to the two GPs.

Previous funding
Axcel took a majority stake in Peab through an MBO in January 2013, with the company's existing shareholders and management retaining a combined substantial minority shareholding post-buyout.

Company
Founded in 2000 as a Peab subsidiary, Netel is a telecoms and electricity infrastructure contractor. The Stockholm-headquartered company builds network infrastructure for telecommunications, broadband and electricity transmission in the Nordic and Baltic countries.

Netel generated SEK 1.5bn in revenues in 2015 and employs a staff of 340.

People
Axcel – Stefan Hollander (director).
IK Investment Partners – Alireza Etemad (partner).
Netel – Erik Salling (CEO).

Advisers
Equity – PwC (corporate finance); Mannheimer Swartling (legal).