NB Renaissance explores options for Novamont

Micaela Osella , Ryan Gould and Kezia Joseph
07 March 2022

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NB Renaissance has started exploring strategic options for portfolio company Novamont, with investment banks due to pitch for advisory roles in the coming weeks, a source close to and four sources familiar with the situation said.

A sale process for the Italian bioplastics company could launch in the second half of the year, the sources said.

According to one of the sources familiar, the sponsor has decided to start considerations for Novamont after it received unsolicited approaches. A final decision about a sale is yet to be made, the source close said.

An auction could see Novamont marketed off EUR 50m-60m EBITDA, the first source familiar said, disclosing that its margin ranges between 25%-30%.

The company has been on the radar of private equity buyers in recent years, two other sources familiar said, noting that a deal now could be more logical as the company enters its sixth year of sponsor ownership.

PwC would be the frontrunner for the sale mandate, according to two of the sources and another two sources familiar with the matter. The advisor worked with NB Renaissance when Novamont acquired BioBag Group, a Norway-based supplier of low-impact solutions for waste collection and packaging, last year.

Novamont has remained resilient during the COVID-19 crisis, two of the sources familiar said. It generated EUR 287m revenues in 2020 with strong EBITDA margins, one of the sources said, noting that these figures do not include the acquisition of BioBag, which has sales in the region of EUR 41m.

On the other hand, the war in Ukraine may affect the Italian M&A pipeline, including plans to launch a sale of Novamont, one of the sources familiar said. Even with Novamont not having much exposure to the countries directly affected by the war, the situation will have an impact in the bidder universe, the same source added.

NB Renaissance acquired a 35% stake in Mater-BI, which controls Novamont at 75%, in early 2016 from the Montedison group, and Versalis owns the remaining minority stake, the second source said.

Novamont has headquarters in Novara, production plants in Terni, Bottrighe and Patrica and research laboratories in Novara, Terni and Piana di Monte Verna, according to its website.

Novamont and NB Renaissance declined to comment, Versalis did not return request for comment.