
Alto Capital sells CEI Group to White Bridge
Italian sponsor Alto Capital has sold CEI Group, a Bologna-based spare parts manufacturer and distributor of spare parts for heavy vehicles, to White Bridge Investments.
Alto Capital is reinvesting a stake of around 12% alongside the new buyer via Alto Capital IV. Elisabetta Boni and Giordano Zauli, CEO of LEMA, will continue to maintain their operating roles and have also re-invested in the deal.
Under the new ownership, CEI Group will further pursue a buy-and-build strategy and additional add-on opportunities will be considered, according to a statement.
BPER Banca, Credit Agricole Italia, Intesa San Paolo and Banco BPM provided debt to back the deal.
CEI marks the second exit of Alto Capital IV after OFI, a nutraceutical company sold in December 2020 to private equity fund InvestIndustrial Growth. Alto Capital IV held a EUR 210m final close in April 2018, hitting the fund's hard-cap and surpassing its EUR 150m target.
The Italian sponsor acquired aftermarket products for commercial vehicles manufacturer in April 2020, taking a majority stake from the founding family Boni. Elisabetta Boni, daughter of the founder, maintained her role in the company as a CEO, the statement said.
Alto Capital acquired the company at a time when the COVID pandemic and the lockdown were in full swing. But the business was unscathed as clients still needed to maintain their vehicles and were willing to pay for a premium, a source familiar with the company said.
CEO Boni was seeking an investor to the company at the time as she wanted to share strategic decisions with another shareholder, the source said.
During the sponsor's holding period, CEI Group bolted on LEMA, a company active in the production and sale of gaskets and metal-rubber components for the aftermarket. LEMA generated sales of around EUR 20m and EUR 3.5m EBITDA. Internally, it created an incentive scheme for managers, as well as boasting its warehouse efficiency, the source added.
Alto decided to exit as its ability to invest further into the business was limited, the source said, noting the fourth fund is nearly fully deployed. Remaining a minority investor is a compromise between allowing it to benefit from further upside in the company, the source added.
Revenue and EBITDA grew by 58% and 43% to EUR 98m and EUR 23m respectively between 2019 and 2021.
The vehicle focuses on majority and minority acquisitions of SMEs headquartered in North Italy. It mainly targets business operating in the luxury, food, design, industrial and services sectors with revenues within the EUR 20m - EUR 80m bracket. 70 investors backed the fund, 56% of them are institutional investors and 38% are international LPs
Company
CEI, founded in 1969, is an international player in the development, production and commercialisation of aftermarket products for commercial vehicles above 3.5t.
People
Alto Capital – Enrico Ricotta (Senior Partner and Director) and Pietro Marchianò (Investment Analyst).
CEI Group – Elisabetta Boni (CEO).
Advisor
Vendor – RP Legal & Tax (legal).
Equity – Banca Akros (M&A); Deloitte (financial due diligence, tax); Giovannelli e Associati Studio Legale (legal); KPMG (debt advisory).
Debt – Simmons & Simmons (legal).
[Editor's note: Subsequent to publication, the article has been updated to include background information gleaned from a source familiar with the situation.]
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