Mandarin exits Italian valve supplier

The China-Europe cross-border firm has exited an Italian valve supplier after helping it develop a base in China.

Mandarin Capital Partners has exited Gasket International to Hutchinson, a French supplier of thermoplastic and rubber components that is an affiliate of France's Total Oil. 

Financial details were not disclosed.

In 2008, Mandarin bought a 70 percent in the Italian valve components producer, which supplies the oil and gas industry. Mandarin's original investment was roughly $100 million, Alberto Forchielli, founding partner, told Private Equity International.

According to the firm, during the holding period Gasket doubled revenues to reach €72.5 million in 2012 through new customer wins and international growth. 

[Gasket] was set up in China to serve major Chinese oil companies and now it has nearly grown bigger than the Italian [parent company]. There is incredible demand in China for high-quality certified oil and gas equipment

Alberto Forchielli, founding partner, Mandarin Capital

Mandarin, which specialises in cross-border investments between China and Europe, facilitated the company’s development of a China-based subsidiary, Gasket Suzhou Valve Components, which reached €22 million ($29 million) of revenue in its third year of operation, according to a statement from Mandarin.

“[Gasket] was set up in China to serve major Chinese oil companies and now it has nearly grown bigger than the Italian [parent company], Forchielli said. “There is incredible demand in China for high-quality certified oil-and-gas equipment.”

Enrico Ricotta, managing partner, said in the statement: “Gasket International is a success story  that perfectly epitomises Mandarin’s investment strategy and mission, typically based on value creation through Chinese-European cross-border projects.” 

The investment came from Fund I, which is “90 percent-plus” invested, Forchielli said. By the end of 2013, Mandarin expects to have returned to shareholders 80 percent of invested capital in Fund I, he added.  

Mandarin is currently raising Fund II with an official target of €400 million, which has been brought down from the initial target of €1 billion, PEI reported earlier. The firm reached a first close on €150 million in July.