Electra and Exponent team up for £400m PhotoBox deal

Although the parties involved declined to disclose the value of the transaction, unquote" understands it sits around the £400m mark. The offer is still subject to consultation with employee representatives and anti-trust clearance.

Should the deal go through, Exponent and Electra would secure the majority of the goup's share capital, with management reinvesting part of their proceeds. This would mean a full exit for previous backers including Highland Capital Partners, Index Ventures and HarbourVest Partners.

Simplifying the shareholder structure is one of the factors behind the proposed deal. With its new backers in place, PhotoBox would also look to enhance its mobile
offering and accelerate its international growth organically, among other goals.

JP Morgan is set to provide debt to further finance the acquisition.

Previous funding
The company started its life as France-based Photoways, which was backed initially in July 2005 by Index Ventures and Highland Capital Partners in a €24m series-A round, according to unquote" data. The following year, Photoways merged with UK-based PhotoBox to create a €30m group by revenues. In July 2007, HarbourVest joined Index and Highland to provide a €10m series-B round for the business.

In 2011, PhotoBox acquired online greetings card retailer Moonpig.com for £120m. The acquisition was funded by a combination of cash and shares, including fresh funding from Highland, Index, HarbourVest and new investors Insight Ventures, Quilvest Ventures and Greenspring Associates. This transaction followed reports that PhotoBox was believed to be heading for the stock exchange.

IPO plans were firmly pursued in early 2014, with a potential £500m market cap for the business. However, the company cited volatile market conditions to pull out of the move, opting for a refinancing by Barclays and Royal Bank of Scotland instead.

Company
With roots dating back to 1999, PhotoBox is the parent group of the PhotoBox, Moonpig, PaperShaker, Sticky9, Hofmann, Posterjack and posterXXL brands. The group offers photobooks, personalised apparel, gifts and greeting cards. It employs 1,000 staff across Europe and generated turnover of £215.3m in 2014. More than half (57%) of revenues are generated outside the UK. According to the company, turnover has increased twentyfold over the past 10 years.

People
Bill Priestley and Simon Davidson represented Electra and Exponent on the deal, respectively.

Advisers
Equity – Evercore (M&A); Allen & Overy (Legal); OC&C Strategy Consultants (Commercial due diligence); KPMG (Financial due diligence); Shearman & Sterling (Legal).
Company – Goldman Sachs (M&A); EY (Financial due diligence); Herbert Smith Freehills (Legal).

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Send to  

• Topics
• UK / Ireland
• Buyouts
• Exits
• Consumer
• Electra Partners LLP
• Exponent Private Equity
• Secondary buyout