Ambienta reaps €330m on IPC trade sale

The Milan-based GP exited its investment after a two-year holding period. According to a statement, the price gives the deal an EBITDA multiple of 11.9x, without considering €12m of annual cost synergies expected to be achieved by 2019.

The transaction is expected to be completed in H2 2017 and is subject to customary conditions and regulatory approvals. As part of the deal, representatives from IPC's management team will join Tennant's management team.

The deal marks the largest exit and the third trade sale by Ambienta, which sold industrial cooling systems producer Spig to US-listed Babcock & Wilcox Enterprises for €155m in May 2016.

The transaction represents the largest acquisition for Minneapolis-based Tennant, which aims to expand internationally and double its current market share across the EMEA region and boost its products portfolio to cleaning tools and supplies.

In 2016, Tennant posted $1bn in pro forma revenues and $115m of adjusted EBITDA. Following the transaction, the US corporate expects its net debt position to range below the 3x multiple of its adjusted EBITDA value.

Previous funding
In July 2014, Ambienta fully acquired the business for €50m in equity via its Ambienta Fund II, from Italian GP Synergo. The deal involved a refinancing of existing debt, provided by UniCredit, Intesa, UBI Banca, Banca popolare dell'Emilia Romagna, Banco Popolare, IKB and Banca Monte dei Paschi di Siena, according to unquote" data.

The company's private equity ownership period started in 2005, as BS Private Equity and Sofipa Equity Fund, the investment arm of Unicredit, acquired 82.7% of the company alongside IPC management. The vendor, Interpump Group, reinvested to take a minority stake of 17.3%.

In 2006, Interpump sold its stake to BS, which went out of business in 2011. Synergo took over BS's portfolio and concurrently Sofipa's stake in the business. Proceeds totalling €1.61m were paid to Sofipa for the sale of its 13.19% stake.

Company
Headquartered in Venice, IPC produces commercial cleaning machines, including sweepers and scrubbers, vacuum cleaners, high-pressure washers, and equipment such as multi-purpose cleaning trolleys, window-washing systems, antibacterial microfiber mops and cloths.

IPC was established in 2005 following the merge of several businesses operating in the cleaning sector. Currently, it operates under several brands, such as IPC Forma, IPC Eagle, IPC Gansow, ICA, Vaciensa, Portotecnica, Sirio and Soteco, Euromop and Pulex.

The business has four manufacturing plants and 11 offices globally, and claims to export 80% of its production across the European market. The American continent represents 11% of its revenues, while China and India account for the remaining 9%.

In 2016, the business generated a turnover of €192m with €28m in EBITDA, representing a 14% margin. IPC currently employs a staff of 1,000.

People
Ambienta - Mauro Roversi (partner, chief investment officer); Francesco Lofrini (principal); Andrea Venturini (associate)
Tennant Company – Chris Killingstad (chair, CEO).

Advisers
Acquirer – Goldman Sachs & Co (M&A); Baker & McKenzie (legal).
Vendor – RW Baird (corporate finance); Linklaters (legal); EY (financial due diligence, tax, ESG due diligence); Roland Berger & Partners (commercial due diligence).

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• Topics
• Exits
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• Trade sale
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