CVC secures €700m Finnish deal

This is the third investment the firm has made from its €10.5bn CVC European Equity Partners VI

UK-based CVC Capital Partners has acquired ParocGroup, a producer of stone wool insulation in the Nordic and the Baltic regions for approximately €700 million, according to a statement.

The debt-equity split was approximately 50-50, according to a source familiar with the deal. CVC declined to comment beyond the statement.

Helsinki-based Paroc produces building insulation and technical insulation for the residential and commercial construction markets. The group has approximately 2,100 employees and nine production facilities in Finland, Sweden, Lithuania, Poland and Russia.

Paroc has been owned by a group of banks and institutional investors since Arcapita had to cede control of the business in 2009.

Since then it has grown its revenues from €317 million to €433 million. In the same period, EBITDA grew to €80 million from €46 million, all through organic growth, according to CVC. Most recently, the group has invested in a new facility in Izoplit in Russia.

CVC made the investment, which is subject to customary competition clearances, using capital from CVC European Equity Partners VI, which closed on its €10.5 billion hard-cap in June 2013, it is understood.

This is the third deal from this vehicle. In June CVC teamed up with Leonard Green & Partners to acquire a majority stake in Advantage Sales & Marketing (ASM), a North American provider of outsourced sales and marketing services, from Apax Partners in a deal that was worth approximately $4 billion. In April, CVC bought a stake in Deoleo, an olive oil producer in Spain.

Earlier this year, CVC was still investing its prior fund CVC European Equity Partners V, a €10.75 billion fund it closed in 2008. In March it invested in Synsam Nordic, an optician chain in the Nordic region, from Alipes, a Swedish investment firm owned by IKEA Investments, and former store owners, while in February, CVC acquired AVAST, a US-based security software company, in a deal that valued the company at $1 billion.

CVC, which was founded in 1981, has completed more than 300 investments in the last 30 years, with an aggregate transaction value of more than $125 billion globally.