Milestone makes it five exits for the year

Anglo-French buyout firm Milestone Capital Partners has completed another exit from its third fund with the sale of dry cleaning business 5àSec. It has now returned 60 percent of investors’ commitments with over half of its original deals still in the portfolio.

Milestone Capital Partners has made a 2.2 times return from the sale of French dry cleaning business 5àSec to ING Parcom, as the Anglo-French buyout firm continues to bounce back from its troubles of 2006.

This afternoon Milestone completed the sale of 5àSec, the world’s biggest retailer of textile services like dry cleaning, laundry and alterations. The French-based business, which now runs up to 1200 shops in 22 countries, has been sold to ING Parcom, a unit of Dutch insurer ING’s private equity arm.

Terms were not disclosed, but the business had revenues of about €250 million last year. Milestone, which has backed a buy-and-build strategy for 5àSec since investing €25 million in the company in 2001, is set to make a 2.2 times return on its investment. The business has made 10 bolt-on acquisitions under Milestone’s ownership, including franchises in France, Spain, Portugal and more recently China.

Managing partner Erick Rinner said the investment had been a successful one for all parties: “We helped [management] strengthen their team, implementing IT systems, multiplying revenues by 6 times and EBITDA by more than 10 times, while using low financial leverage,” he said.

Milestone has been hitting the exit trail in earnest this year, after coming under pressure from investors last year to cut costs after failing to make any exits since the third fund closed in 2002. It has now sold four of the nine businesses in the portfolio of the third fund, while a fifth exit from fund two, the sale of dataroom operator IX Europe, is set to complete any day now.

The buyout firm, formerly known as European Acquisition Capital, is hoping to return to investors to raise a new fund later this year, according to market sources. It currently has about €400 million under management.