BC Partners to join Bain as co-investor in Fedrigoni

Min Ho
26 July 2022

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BC Partners has agreed on a deal to co-invest in Fedrigoni alongside incumbent sponsor Bain Capital, with the two parties now holding joint control of the Italian paper and label manufacturer.

The deal values the company at around EUR 3bn based on an approximately EUR 300m EBITDA, according to a source close to the situation.

The two parties will hold around 45% of the shares, with the remaining percentage held by minority shareholders, including the management team and Canson Capital Partners, a UK-based advisory and merchant banking boutique, the source said.

As part of the deal, the company will pursue a growth strategy, including further bolt-on acquisitions in self-adhesive labels and fibre-based packaging products, as well as adjacent segments, the source said. The company is aiming to grow the business to about EUR 500m EBITDA before considering an exit via the IPO route potentially, the source said.

Bain Capital acquired Fedrigoni in 2017. Under Bain Capital's ownership, Fedrigoni has more than doubled its adjusted sales and nearly tripled adjusted EBITDA through a combination of organic growth acceleration and M&A execution, according to a statement.

Bain Capital launched a sale process in May through Rothschild and Morgan Stanley, reportedly attracting interest from KKR, Carlyle, Intermediate Capital Group and Onex.

The bidding pool was narrowed down to a smaller handful of players, including Partners Group and Onex, the source said, adding that BC Partners was eventually awarded exclusivity to the deal last week.

BC Partners is currently deploying BC European Capital XI, which raised EUR 6.9bn in January, against its original target of EUR 8.5bn.

The transaction is expected to close by the end of 2022, subject to approvals by relevant regulatory authorities, according to the statement.

Company
Founded in 1888, Verona-headquartered Fedrigoni is a manufacturer of self-adhesive labels and materials and high value-added papers for luxury packaging and other creative solutions. The company currently has more than 4,500 employees in 27 countries and 48 facilities, including production plants, cutting centers and distribution.

People
BC Partners – Stefano Ferraresi (partner).
Bain Capital – Ivano Sessa (co-head of industrials at Bain and chairman of Fedrigoni).
Fedrigoni - Marco Nespolo (CEO).
Canson - Matteo Canonaco (co-founder) and Luca Colopi (partner).

Advisors
BC Partners - Canson Capital Partners and Nomura (lead financial advisors), JP Morgan, Afry Capital, White & Case, Kirkland and Ellis, PwC, Studio Legale Tributario Facchini Rossi Michelutti and Bain & Company.
Vendor and company – Goldman Sachs (financial advisor to Fiber Bidco), Rothschild, Morgan Stanley, Latham & Watkins, Pirola Pennuto Zei e Associati, Kirkland & Ellis, New Deal Advisors and Bain & Company.