Enterprise Investors (EI), the Warsaw-based private equity house that invests across Central and Eastern Europe, and CSFB Central European Merchant Partners have exited Grupa Kêty, the Polish aluminium-extruded goods and packaging materials producer in a transaction that generated proceeds of $17.5m for the EI.
The transaction, the first of its kind in Poland in which private equity investors have achieved a full exit through a stock exchange flotation, sees an undisclosed group of Polish and foreign financial institutions pay just under $30m for the remaining stake in Kêty. It is also the largest single secondary trade in the history of the Warsaw Stock Exchange.
The shares were sold at $11.20, a ‘substantial’ premium to a number of indicative offers when EI had considered a trade sale of Kêty in 2001. The firm originally paid $13m for a 19 per cent stake and roughly doubled the investment, made as part of a consortium of private equity firms in 1995 which acquired a 40 per cent stake from the Polish State Treasury.
Enterprise Investors invested in Kêty through the Polish-American Enterprise Fund and Polish Private Equity Funds I & II and was the majority investor in Kêty.
A spokesperson for Enterprise Investors said the exit was a landmark private equity investors in Poland. “The sale shows that the Warsaw Stock Exchange can become a successful means of exit and liquidity for private equity firms. There is a growing level of interest from institutional investors and pension funds in the Polish market.”
The Warsaw Stock Exchange has seen three initial public offerings, two of which have been undertaken by Enterprise Investors. The firm's spokesperson confirmed reports earlier this week that EI is hoping to float one or two companies per year on the exchange, bucking the trend elsewhere which has seen the public markets virtually disappear as an exit route for private equity-backed businesses.