Mandarin Capital buys ICF, refocuses investment strategy

MCP committed €18m of the overall equity injection of €20m, taking a 92% stake in the firm. The company's CEO and other shareholders also invested in the business as part of the transaction.

The deal gives the company an enterprise value of €37m, equal to around 5x EBITDA.

MCP invested via its latest vehicle, Mandarin Capital Partners II, which launched in March 2013 and has a €500m hard-cap. The fund held a first close on €110.5m in September 2013. A second close on €200m is expected over the summer. The fund's original investment strategy included the acquisition of Chinese companies seeking growth in Italy, and vice versa. However, the GP has since decided to cease outbound investment in Chinese companies as lower returns meant fundraising in China proved challenging.

The investors plan to grow the business through acquisitions, with a particular focus on the Chinese market.

Company
Established in 1918, ICF operates in the adhesives, special footwear textiles and upholstered furniture sectors. Based in Marcallo con Casone, near Milan, with a commercial affiliate in Mexico, the company's revenues are expected to exceed €60m this year.

People
Alberto Forchielli is founding partner of MCP. Fabio Sattin is president and founding partner of Private Equity Partners.

Advisers
Equity (MCP) – Eversheds Bianchini (Legal); EY (Tax, financial due diligence, commercial due diligence); Tauw Italia (Other due diligence).

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• Topics
• Southern Europe
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• Mandarin Capital Management SA
• Private Equity Partners SGR Spa