Magnum Capital buys Iberchem

Amy King
05 June 2013

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Spanish GP Magnum Capital has acquired a majority stake in Iberchem, a Spanish fragrances producer, from Capital Alianza.

The company's management team has upped its stake in the firm as part of the transaction.

The investor made an offer of around €80m, equating to 8x EBITDA.

The company was sold through an auction process, which saw interest from around 25 international and local GPs.

Magnum intends to grow the firm through the consolidation of its existing position in China, Indonesia and the Middle East. The firm also plans to enter emerging markets.

Previous funding
Iberchem has a history of private equity ownership. In 2008, Capital Alianza acquired an 87.1% stake in the firm in an MBO valued at €35m. The transaction saw Espiga Capital and InverMurcia, managed by Baring Private Equity Partners, exit the firm, with the former enjoying an IRR of around 20% and a money multiple in excess of 3x.

The transaction was leveraged with a €16.8m loan provided by a syndicate of five banks and Spanish regional savings banks led by EBN Banco Negocios.

In 2005, Iberchem received expansion funding from Espiga and InverMurcia. The round totalled €1.5m, of which Espiga invested €1.1m, with the remainder coming from InverMurcia and the management team.

The duo had invested in the company in 2002 to fund the opening of a factory in Murcia and the acquisition of a Chinese plant.

Prior to that, Espiga invested around €5m in 1999, acquiring 78% of the company's equity from its three founding partners, two of whom re-invested in the company in return for an 8.38% stake in the business.

Company
Founded in 1985 and headquartered in Murcia, Iberchem is a fragrances and flavours firm. The company has more than 320 employees across its subsidiaries and more than 11 production centres in Spain, China, Indonesia, Malaysia, India, Italy, Tunisia, Colombia and Mexico.

Iberchem reported a turnover of around €57m in 2012. More than 90% of its revenues originate abroad.

People
Ángel Corcóstegui is founding partner of Magnum Capital and the new chairman of Iberchem. José María Castañé is chairman of Capital Alianza.