LBO France will sell Winoa Group, a stone and metal cutting business, to KKR Asset Management.
The value of the transaction was not disclosed. It is understood LBO France started an auction process in April and received several offers for the business.
LBO France did a dividend recap of the business in 2007, which took out about 50 percent of its initial investment, according to a source familiar with the matter. LBO France declined to comment.
The Paris-headquartered firm invested in the business in 2005, using its White Knight VII vehicle, which is a $126 million, 2002-vintage, according to PEI’s Research and Analytics division.
With the divestment of Winoa, LBO France’s White Knight VII is fully divested. The vehicle, including the Winoa exit, has generated a 2.2x return, according to the source.
It is understood Winoa was hit very hard by the global financial crisis. Its business, which has 12 operational plants on four continents and a workforce of over 1000, is linked to the housing sector. It was exposed to the badly hit housing markets in Spain and Italy, according to the source. The company had a debt restructuring in 2009, and has stabilised since then, with a current EBITDA of €50 million, the source added.
KKR made the investment through funds managed by KAM Special Situations, which makes investments in good companies whose capital structure is under pressure. The acquisition facilitates a recapitalisation of the business through a significant reduction of the debt and access to new money for growth, KKR said. It is understood that after the deal, 55 percent of the debt will remain in the business.
LBO France’s sale of Winoa follows a number of recent exits made by the firm, including the sale of Maisons du Monde to Bain Capital and the sale of Groupe Poult’s Polish activities to Bridgepoint. LBO France will be keen to return money to investors as it is currently in market attempting to collect €1 billion for its successor fund, White Knight VIIII.
The firm’s White Knight funds target companies in France with an enterprise value of €100 million to €2.5 billion.