IK buys roof repair business

The European buyout firm has bought into a part of the construction industry it believes is counter cyclical driven by regulations compelling people to fix their roofs.

Industri Kapital has bought French roof repair business Groupe Etanco in a management buyout alongside the founding Lebraut family. Terms were undisclosed, but a source close to the deal said the London-based buyout firm had paid €250 million ($362.3 million).

The company sells roof repair and safety products.

The source said Industri Kapital had borrowed €142 million from a consortium of banks.

These included French banks Societe Generale and CIC as well as Bank of Ireland as the lead arrangers. The deal’s mezzanine has been pre-syndicated to four other banks.

The business has an EBITDA of around €26 million and a turnover of €130 million.

Christopher Masek, a partner at Industri Kapital, said: “This business is less exposed to [any downturn in the construction industry and economy generally] given its customer base and French regulations.”

The business will continue to generate sales because of changes in the French law obliging businesses to repair their roofs, Masek said. The majority of the company’s business is driven by the repair of existing building stock rather than of new-builds.

Industri Kapital will look to grow the business organically in France and Italy as well as expanding it into Germany and Eastern Europe. The buyout firm will also attempt to develop closer synergies between the business’ French and Italian arms, which have greater potential for cross-selling.