Sun European Partners buys Paragon Print & Packaging

Anneken Tappe
02 January 2013

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Sun European Partners has acquired a majority stake in British label maker Paragon Print and Packaging from Equistone, LDC and the management team.

The deal would value Paragon, which has a turnover of more than £170m, at £150m. The GP is looking to refinance within Q1 2013, after completed the all-equity transaction.

The company's management team, including founder Tony Lennon, also invested as part of the deal. Prior to the transaction, management held 51% of the firm.

The deals also sees Equistone Partners Europe and LDC exit their respective 34% and 15% stakes. Equistone first acquired the business in 2001. In December 2005, it partially exited the company, while LDC took a stake. Lloyds TSB provided a £3m mezzanine loan as well as senior debt for that deal. At the time of the acquisition, Paragon recorded an annual turnover of £80m. In 2007, Equistone re-upped their stake to 34%. The sale represents its fifth exit in 2012.

Company
Paragon Print & Packaging is a Spalding-based producer of labels and packaging, founded in 1994. The company is composed of four divisions, labels, film, board and artwork. It operates 10 production facilities across the UK.

All major British supermarket chains, including Tesco and Sainsbury's, are customers of Paragon.

People
Philippe Neuschaefer, vice president, led the transaction on behalf of Sun European Partners. Andrew Murtagh, director, led the exit for Equistone. Mark Lapping is CEO of Paragon.

Advisers
Equity - DLA Piper (Legal); KPMG (Accounting due diligence, tax).
Vendor - Rothschild (Corporate finance); Pinsent Masons (Legal); PwC (Financial due diligence); Boston Consulting Group (Commercial due diligence).