Palamon in SEK 765m SBO of Happy Socks

The enterprise value comprises a SEK 725m valuation of the company and a SEK 40 growth capital injection, according to a statement by the GP.

Incumbent backer Scope Capital, a Swedish growth investor, exited Happy Socks in the transaction and netted a 4.7x money multiple on its original investment, it said in a statement. The exit comes just over a year after the VC invested in Happy Socks.

Founders Mikael Söderlindh and Victor Tell will remain active in their current roles within the company, following Palamon’s buyout. The duo will retain a minority stake in the business alongside other investors, totalling 25%.

Previous funding
In January 2015, Scope tapped its 2012-vintage €90m Scope Growth III vehicle to acquire around half of Happy Socks' share capital.

Company
Headquartered in Stockholm, Happy Socks is a designer and manufacturer of socks and underwear.

The company claims its revenues in 2016 reached €100m after three years of annual revenue and EBITDA growth in excess of 50%, according to Palamon.

People
Palamon Capital Partners – Ali Rahmatollahi, Ricardo Caupers (partners).
Scope Capital – Fredrik Oweson (partner).
Happy Socks – Mikael Söderlindh, Victor Tell (co-founders).

Advisers
Equity – Carnegie (corporate finance); PwC (financial due diligence, tax); Slaughter & May (legal); Gernandt & Danielsson (legal).
Vendor – William Blair (corporate finance); PwC (financial due diligence); Insider (commercial due diligence); Mannheimer Swartling (legal).
Company – Andulf (legal).

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• Topics
• Buyouts
• Exits
• Consumer
• Nordics
• Sweden
• Palamon Capital Partners
• Secondary buyout
• Carnegie
• Mannheimer Swartling
• PwC
• Slaughter & May