CVC sells DT Group for €1.5bn

CVC Capital Partners has sold Danish building materials retailer DT Group for €1.5bn, three years after acquiring the business in a €540m public-to-private.

CVC Capital Partners, a UK-based buyout firm, has sold DT Group, a Nordic distributor of building materials, to Wolseley for €1.498 billion ($1.89 billion).

The deal, including the assumption of €484 million of net debt, gives DT Group an enterprise value of €1.982 million. Deutsche Bank and Nordea advised CVC Capital Partners on the sale.

CVC Capital Partners originally acquired DT Group, then known as Danske Traelast, in April 2003 in a public-to-private valuing the business at €540 million. The firm invested from CVC European Equity Partners III, which closed on €3.6 billion in 2001

Peter Törnquist, senior managing director at CVC Capital Partners and chairman of DT Group, said that CVC had helped DT Group’s revenues grow by about 20 percent and profits by 40 percent during its stewardship. “Our number one priority when we bought DT was housekeeping, get the efficiencies and costs to work. Then we worked on the way that procurement of purchasing was done, taking advantage of DT’s scale by setting up pan-Nordic purchasing operations and pursuing low-cost sourcing.

“We also set up buying offices in eastern Europe and Beijing, put the Danish businesses under a common brand, and pursued growth both organic and through acquisitions.”

Based in Denmark, DT Group is a distributor of building materials for trade professionals and consumers in Denmark, Finland, Sweden and Norway. The business operates from 256 locations across the Nordic region, employs approximately 8,000 staff and reported revenues of €2.4 billion and EBITDA of €169.5 million in 2005.

Other private equity deals in the building materials sector this year include 3i’s sale of Ireland’s MKM Building Supplies to JP Corry Group; Dunedin Capital Partner’s £62 million sale of Calsafe Group to Champion Enterprises of the US, making a 5.8 multiple; and listed French investor Wendel Investissement’s €1.02 billion buyout of Materis alongside LBO France.