Opera sells boat maker for shares

The all-share private equity deal has arrived in Italy with the sale of Cantieri Itama, the speedboat maker owned by Opera, the luxury goods investor, to Permira-backed Ferretti Group.

Ferretti Group, a maker of yachts and other boats, has acquired speedboat maker Cantieri Itama from Italian private equity firm Opera in exchange for a 1.15 percent stake in Impe Lux Sarl, the holding company that owns Ferretti.

Renato Preti of Opera told Dow Jones: “I expect we’ll see more all-paper deals between private equity funds, due to the growing size of the secondary market, and especially in Italy where companies need to be bulked up in size.”

The likelihood of such deals increases when other exit routes are limited. The IPO market is subdued at present, and the luxury boats sector has few potential trade buyers. Azimut-Bennetti, a rival to Ferretti, was seen as the only other likely trade buyer of Cantieri Itama.          

In theory, this puts the buyer in a position of considerable negotiating strength. However, Cantieri Itama is understood to have been sold for around 12 times EBITDA, which Preti said was about the right price for a luxury boat business. With Ferretti thought to be worth €960 million, the sale values Opera’s 1.15 percent stake in the holding company at around €11 million, which is about double what Opera invested in Itama in 2001.      

Opera, the luxury goods sector specialist, launched its second fund last year with a target of €250 million and by May 2004 was reported to have raised around €90 million. The following month, it announced an agreement with US investment bank Bear Stearns, by which the latter would invest up to €200 million in Italian lifestyle companies on a deal-by-deal basis in partnership with Opera.

London-based private equity firm Permira acquired a 70 percent stake in Ferretti Group via a €675 million public-to-private transaction in September 2002.