Australia’s DB Capital in apparel roll-up

Despite the recent departure of two senior executives, investment activity at DB Capital Partners, the private equity arm of Deutsche Asset Management in Australia, is showing no signs of a slowdown.

DB Capital Partners, the Australian private equity arm of Deutsche Asset Management, has acquired a majority interest in Hopkins Group, a wholesale women apparel business.

As part of an ongoing DB Capital effort to consolidate the apparel sector, Hopkins will be rolled into Pacific Apparel Solutions (PAS), in which the firm is a major shareholder. The firm declined to disclose the size of its latest investment.

Sydney-based Hopkins focuses primarily on womenswear and sells garments via key brands Marco Polo, Sirroco and Capital M.

Albin Kurti, a director of DB Capital and PAS board member, said in a statement: “The Hopkins Group is our fourth acquisition in 18 months and is a significant milestone in our roll-up strategy. PAS is now a very significant supplier of wholesale apparel across Australia.”

The deal comes after a number of successful exits for DB. In December, the firm realised its investment in Pacific Nursing Solutions, a nursing agency.

More recently, it sold its interest in a radar and communications technology company CEA Technologies to US global defence company Northrop Grumman. Peter Dowding, head of DB Capital, declined to disclose figures to reflect the precise return on the CEA investment, but told PEO that five exits over the past 18 months had produced an average 2.5 times cash multiple on the equity deployed. Original investments totaling A$185 million produced returns totaling A$450 million, Dowding told PEO.

In February of this year, DB Capital Partners directors Gene Lorenz and Rob Nichols, as well as assistant vice-president Nathan Cleary, resigned from the firm.