Charterhouse sells baby products business for £460m

UK investor Charterhouse Capital Partners has sold baby food products business Avent less than a year after acquiring the company from its founders and global private equity firm 3i.

London-based private equity firm Charterhouse Capital Partners has exited its investment in baby food business Avent in a £460 million (€674 million; $867 million) sale to consumer electronics group Philips.

Charterhouse acquired Avent less than a year ago for £300 million. The firm purchased the business from founders Edward and Cella Atkin and private equity firm 3i, which held a 21.6 percent stake.

3i generated proceeds of £64 million, a money multiple of 13 times and an IRR of 35 percent on the £300 million transaction in June 2005. 3i had originally invested £5 million of growth capital in Avent, known then as Cannon Avent, in 1995.

Charterhouse made its investment in Avent through its Charterhouse Capital Partners VII fund, which closed on €2.7billion ($3.47 billion) in 2003. Charterhouse was not immediately available to comment.

Following completion of the transaction, which is expected to close in the third quarter of 2006, Avent will be integrated into Philips’ domestic appliances and personal care division.

Charterhouse was advised on the transaction by Allen & Overy; Philips by Sullivan & Cromwell; and management by Travers Smith.

Founded in 1984, Avent manufactures bottle, breast and toddler feeding products in the UK and US, with sales in over 60 countries. The company reported sales of approximately £113 million for the 12 months ended March 2006, a 12 percent rise on the previous year’s figures.

According to Philips, the mother and baby care products market is valued at approximately €7 billion and is expected to grow by 5 percent per year on average over the next five years in developed markets and 10 percent in emerging markets