Litorina acquires Nordic play centre chain

The Swedish mid-market firm will own the business alongside its management

Swedish mid-market private equity firm Litorina Kapital has acquired a majority stake in Scandinavian play centre chain Leo’s Lekland, according to a statement from the firm.

Financial details of the transaction were not disclosed. Litorina declined to comment beyond the statement.

Litorina acquired the stake from Kooperativa Förbundet, a federation of consumer co-operatives in Sweden, via KFI Kapital with funds from Litorina IV, which closed on its SEK 2.5 billion ($340 million; £210 million) hard cap in 2010. Probitas Partners acted as a placement agent for the fund.

In a statement, KF said it invested in Leo’s Lekland in July 2010 and holds a 65.5 percent stake in the company. It is unclear how large a stake Litorina is acquiring, but the firm said key personnel at Leo’s Lekland will remain as joint owners together with Litorina.

KF said it will reinvest the capital released in Coop Sweden.

Founded in Luleå in northern Sweden in 2006 by company CEO Joakim Gunler and Jonas Rönnqvist, Leo’s Lekland operates 23 play centres in total, thirteen in Sweden, nine in Norway and one in Denmark. The company is “poised for further expansion in the Nordic region”, according to Litorina.

In 2013 the company had 184 employees and a turnover of SEK 223 million ($30.5 million; £18.9 million). Its 2014 turnover is forecast to exceed SEK 250 million ($34.17 million; £21.2 million).

“Our cooperation with Litorina will bring additional resources, enabling the company to continue establishing new play centres, as well as industrial support, allowing the company to develop the concept further and to improve its existing highly developed operations,” Gunler said. “This should mean that we can further strengthen our brand with consumers.”

Other investments from Litorina IV include a 70 percent stake in Sveba-Dahlén Group, a Nordic supplier of bakery equipment, and a majority stake in Eton Fashion, a men’s shirts, ties and accessories brand.

Litorina manages a total of SEK 4.8 billion ($660 million; £410 million) in four funds, and typically acquires majority stakes in Nordic companies with enterprise values between SEK 200 million ($27.3 million; £17 million) and SEK 1 billion ($140 million; £85 million), according to the firm’s website.