Rhône acquires 45% stake in Maxam from Advent

Nicole Tovstiga
02 August 2018

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Rhône Capital has acquired a 45% stake in Spanish explosives supplier Maxam from Advent International.

Maxam's chairman and CEO José Sánchez-Junco will continue to hold the remaining 55% of the company's shares.

The deal closes a seven-year holding period for Advent, during which it supported the strategy set out by the company's management team, enabling it to pursue its domestic and international growth plans by expanding its market presence through organic growth.

Previous funding
In 1994, Pallas Invest Iberian Fund led a £43m buyout that left management with a 20% stake. BancBoston Capital and PineBridge Investments completed a refinancing of the company, valued at £133m, in 2000.

Reef Investissements and BancBoston teamed up to acquire the company in 2001 in a secondary buyout believed to be in the region of €50-100m, with management retaining 42.5%.

Ibersuizas completed a joint deal with Vista Capital in March 2006 to acquire 49% of Maxam (then known as Unión Española de Explosivos), which at the time was worth €500m. Ibersuizas took 27.4%, while Vista held 22.6%, and the company's management team increased their stake to 50%. Originated by a corporate finance adviser, the transaction involved the acquisition of the 57.5% that previously belonged to Reef and BancBoston. A debt package was provided by Banestoque.

Advent acquired a 49.9% stake in Maxam in September 2011 as part of a secondary buyout from Portobello Capital and Vista Capital. Portobello had acquired a portfolio from Ibersuizas earlier in 2011. The remaining share capital was kept in the hands of the management team.

Company
Founded by Alfred Nobel in 1872 and based in Madrid, Maxam supplies explosives, initiating systems, sport cartridges and ammunition for the armed forces. It is the third largest operator of its kind worldwide with 80 industrial facilities and subsidiaries in 50 countries.

The group generated a turnover of €1.1bn in its last fiscal year. It currently employs a staff of 6,500 employees across five continents.

People
Maxam – José Fernando Sanchez-Junco (chairman, CEO).

Advisers
Acquirer – Lazard Frères (financial due diligence); Pérez-Llorca (legal); Kirkland & Ellis (legal).
Vendor – Morgan Stanley (financial due diligence); Uría Menéndez (legal).
Company – Alantra (financial due diligence).