Global Garden Products (GGP) has been acquired in a secondary buyout by ABN AMRO Capital for E555m in a deal subject to regulatory approval.
UBS Private Equity, which is focused on managing and realising its existing portfolio, hired Morgan Stanley to organise an auction of the business in April 2003. The Milan and London offices of ABN AMRO Capital, advised by Sopaf Corporate Finance, worked jointly on a bid, which succeeded in winning the unanimous backing of GGP’s management team. “The auction was very competitive and Morgan Stanley did a very good job for the vendor,” said Ian Taylor, managing director of ABN AMRO Capital in London. Other private equity firms linked with the sale included Bain Capital and PAI.
GGP is Europe’s largest maker of walk-behind and ride-on lawnmowers as well as a range of hand-held gardening equipment and accessories, with brands including Mountfield and Stiga. It also makes own-label products for leading European garden and DIY centres. The European powered garden equipment market is estimated to be worth some E1.9bn, with the lawnmower market accounting for E1.1bn. But Taylor said ABN would be seeking to grow the company in the area of hand tools, including strimmers and hedge trimmers.
GGP, which is registered in Sweden and headquartered in Milan, has manufacturing facilities in Castelfranco Veneto, Italy, and Tranas, Sweden. It employs around 1,700 people and posted sales of E520m in the year ended August 31 2003. It has its roots in UBS’ acquisition of a stake in Swedish lawnmower maker Stiga in 1999, which was then merged with Castelgarden, Alpina and Mountfield in 2000.
Growth drivers in the garden equipment sector include increasing demand for garden products with added convenience, changing weather patterns and increased leisure time. As a result it is proving attractive to private equity houses, with Industri Kapital and Electra Partners completing the buyouts of German firms Gardena and OASE respectively last year.
ABN AMRO Capital was advised on the transaction by Dewey Ballantine, Milan, and UBS Private Equity by Mannheimer Swartling, Stockholm. Following completion of the deal, members of ABN AMRO Capital’s Milan and London offices will take seats on the board.