KKR buys $1bn Italian auto parts maker

Global mid-market private equity firm Vestar Capital Partners has sold Italy’s FL Selenia just two years after acquiring the auto parts firm from Doughty Hanson.

US-based buyout firm Kohlberg Kravis Roberts has acquired Italy-based automotive parts maker FL Selenia from mid-market private equity firm, Vestar Capital Partners.

The deal is valued in excess of €835 million ($980 million), including debt, and is expected to close before the end of the year.

The company has performed well, KKR has significant experience in the auto parts market, and we were able to work out what we felt was an attractive return for our investors and the management team.

Robert Rosner, president, Vestar Capital Partners Europe

Vestar originally purchased FL Selenia through another secondary buyout in September 2003, acquiring the company from Doughty Hanson for €670 million. The transaction was made from Vestar Capital Partners IV, which closed in 1999 on $2.5 billion.

According to Robert Rosner, president of Vestar Capital Partners Europe, the decision to sell FL Selenia had been prompted by numerous offers during its ownership. “We didn’t put the company up for sale,” said Rosner, “but it’s an attractive and well profiled company, so we received a number of unsolicited approaches. The company has performed well, KKR has significant experience in the auto parts market, and we were able to work out what we felt was an attractive return for our investors and the management team.”

Rosner said Fund IV was “essentially fully invested”. He would not disclose Vestar’s fundraising activities, but the firm is understood to have been fundraising for its Vestar Capital Partners V fund over the summer.

Founded in 1988, Denver-based Vestar Capital Partners opened its Milan office in March 2001 and also has a European office in Paris, which opened in September 2000.

Johannes Huth, managing director of KKR, said in a statement: “We intend to support [FL Selenia CEO] Aldino Bellazzini’s strategy to grow the business both organically and through acquisitions in Europe, Asia and the Americas, as the company’s growth plans are aligned with our firm’s substantial capital resources, long-term investing horizon, and global reach.”

KKR already has experience of the European auto parts market, having acquired ATU, a German automotive car parts retailer and service centre operator for €1.45 billion last June.

Located near Turnin, Selenia is a producer of branded automotive lubricants and other functional fluids such as anti-freeze, transmission and engine fluids for automobiles, trucks and tractors, as well as marine and industrial applications.

Founded in 1912 as a division of Fiat Auto, the company generates annual revenues in excess of €550 million according to a release.