Bain sells Fedrigoni's security business to Epiris's Portals

The sale comprises Fedrigoni's facilities specialised in the production of security paper for banknotes and documents, which are based in Bollate, near Milan. The business has been acquired via a newco named Fase.

The deal also includes the possibility for Portals to acquire additional Fedrigoni's assets for the production of banknote and passports paper, which are located in Fabriano. This transaction will be subject to a put and call option, which could be exercised by the end of 2021.

Portals specialises in producing banknotes and security paper for passports, vehicle registration documents, and birth and marriage certificates. The company is controlled by Epiris, which bought the business from its listed parent company De La Rue. Epiris invested via its second vehicle and acquired the business at an enterprise value of £68m.

Fedrigoni is owned by Bain, which acquired a majority stake in the company in December 2017 for €650m, equal to 4.8x the company's 2017 EBITDA. A supporting debt package was provided by BNP Paribas, HSBC, UBI Banca and KKR, which were joint bookrunners on the deal. Bain deployed capital from its €3.5bn Europe IV fund to finance the acquisition.

Company
Fedrigoni specialises in the production and sale of speciality paper and self-adhesive items and labels for the food, beverage and pharmaceuticals industries.

The company, founded in 1888 and headquartered in Verona, employs 4,000 staff across 14 production facilities located in Italy, Spain, Brazil and the US.

Fedrigoni distributes its products in 130 countries worldwide. The business generated adjusted EBITDA of €162.7m from revenues of €1.17bn in 2019.

People
Fedrigoni – Marco Nespolo (CEO).
Portals – Ross Holliday (CEO).

Advisers
Vendor – Pöyry Capital (corporate finance); Latham & Watkins (legal); PwC (financial due diligence); NDA (financial due diligence); Pirola Pennuto Zei (tax); Golder (environmental due diligence).
Acquirer – CMS (legal); KPMG (financial due diligence); Searchlight Consulting (IT due diligence); RPS (environmental due diligence).

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