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Apax picks up chemical distributor from 3i

The sale will generate proceeds of around £62m for 3i

 Apax Partners has agreed to acquire a majority stake in pan-European specialty chemical distributor Azelis Group from 3i Group, according to statements from the firms.

Financial details of the transaction were not disclosed and Apax declined to comment beyond the statement. 3i declined to comment on the deal’s value or return.

3i and funds managed by the group acquired the Azelis stake in December 2006 for €72 million in a deal which valued the company at €315 million. In a statement at the time 3i said it was acquiring a stake of more than 60 percent from Cognetas, which has since rebranded as Motion Private Equity.

Proceeds to 3i Group from the sale will be around £62 million (€85 million; $96 million), representing an uplift of around £36 million (€49 million; $56 million) against a value of £26 million (€36 million; $40 million) at 31 March 2014, the London-listed group said.

Under 3i’s ownership Azelis, which serves customers and principals in the coatings, chemicals, rubber and plastic additives, food and health, animal nutrition, pharma and personal care industries, has grown both organically and through acquisitions. The company has expanded in the UK, Benelux, and Central and Eastern Europe, and has also entered the Asian chemical distribution market, opening a number of offices in China, Japan and South-East Asia.

Alongside the existing management team, Apax intends to continue Azelis’ focus on growth through development of its specialist product portfolio and through global expansion. 

“We have been proactively targeting the specialty chemicals distribution industry and have been following Azelis over the last couple of years,” Apax partner Frank Ehmer said. “We are highly supportive of an investment programme to further strengthen Azelis’ existing platform, both organically and through acquisitions”.

This is Apax’s first investment in 2015, which is made using capital from the Apax Fund VIII, which closed on $7.5 billion in June 2013. The fund’s original target was $11.9 billion, but in December 2012 the firm recognised that this target was unattainable, PEI reported previously.

It is understood that during 2014 Apax generated $8.3 billion in total realisations – the biggest year for exits in its history. In May the firm sold its 56 percent stake in Tnuva, one of Israel’s largest food companies, to China food. Agriculture business Bright Food Group sold for around $2.5 billion, generating a 5x return, while in December, Apax booked 2x on the sale of mobile phone operator Orange Switzerland to family office NJJ Capital for CHF 2.8 billion ($2.9 billion; €2.3 billion), PEI reported at the time.

The firm also invested $1.9 billion last year, including picking up Dutch software business Exact Holding for €32 per share and offering $600 million for Norwegian IT services provider EVRY ASA.