Cinven has expanded its German portfolio with the purchase of CeramTec, a ceramics maker, for €1.49 billion.
The firm will buy the company from Rockwood Holdings, a NYSE-listed industrial group. Subject to regulatory clearance, the deal is expected to complete in the third quarter of 2013.
The transaction, which is to include around €1 billion of debt, will be funded partly through leveraged loans and high yield bonds, a source close to the matter told Private Equity International. The debt will be provided by Deutsche Bank, UBS and RBC, according to the source.
CeramTec makes ceramics for
Based in Plochingen, Germany, CeramTec provides ceramics to the medical, automotive, industrial, and electronic sectors. Established in 1903 as a producer of porcelain, its product range now over a wide array of technical and industrial uses, from prosthetic implants and cutting tools to ceramics used in armour and consumer electronics. The group posted sales of €425 million in 2012, and employs more than 3,000 staff across 18 locations worldwide.
Cinven believes the company offers promising avenues for growth, both through greater penetration in key markets and geographical expansion. “We are particularly impressed with CeramTec’s ability to consistently launch high value, innovative products through economic cycles,” Bruno Schick, partner and co-head of Cinven German’s team, said in a statement. “We are keen to support the company's growth outside its core European markets, specifically in North America and Asia, both organically and through acquisitions.”
CeramTec is the fourth acquisition made by Cinven’s Fifth Fund, after its investments in alarm system maker Pronet, insulation specialist Prezioso and healthcare provider AMCo. The fund last week held a final close on €5.3 billion. It had already reached a €5 billion closing in March, but collected an additional €300 million from late investors.
CeramTec marks Cinven’s sixth investment in Germany. These include SLV, a lighting specialist, and JOST, a truck component manufacturer, which it respectively acquired in 2011 and 2008.