PAI exits last Fund III investment

The last exit by the firm’s Fund III, which brings the overall performance of the 12-year old vehicle to 3.3x, comes as the French GP continues raising a €3bn fund.

PAI Partners, the Paris-based group, has sold FTE automotive to US buyout peer Bain Capital

The deal, still subject to regulatory approval, is expected to close by July 2013. Terms of the transaction were not disclosed. 

Founded in 1943, FTE is an automotive component maker headquartered in Ebern, central Germany. The company designs and produces hydraulic systems for cars and commercial vehicles, in manufacturing facilities located in Germany, the Czech Republic, Slovakia, the US, Mexico, Brazil and China. It counts 3,600 employees, and posted sales of €430 million in 2012. 

PAI initially invested in FTE in 2005, when it acquired the business from HgCapital for €370 million. The firm then led the company through a phase of international expansion, helping FTE establish a presence in regions including Eastern Europe, Brazil and China. Significant investments in R&D, as well as frequent launches of new products, helped the company weather difficult times for the overall automotive industry, according to PAI. 

This exit is the last by PAI’s Fund III, a 2001 vintage that closed on €2.2 billion. It will bring the vehicle’s return to 3.3x and help generate an overall IRR of 37 percent, a source close to the matters told Private Equity International. 

Other successful realisations from the fund have included biosciences business Chr. Hansen, fully exited last year on a 4x, and dairy group Yoplait, which generated a 10x return through a €1.2 billion sale to General Mills in 2011. 

The firm is currently raising its Fund VI with a target of €3 billion, exceeding the total garnered by its Funds IV and V. Both reached their final close on €2.7 billion.