Strategic Value Partners, a distressed investing specialist, has sold the final part of portfolio company IWP International to conclude its successful turnaround of the business five years after its initial investment.
The firm has sold Polbita, the owner of Polish personal care retailer Drogerie Natura, to household products wholesaler Interchem for an undisclosed sum.
The sale is the third of IWP’s three major operating divisions to have been offloaded, following the disposals of UK units Collection 2000 and Batiste earlier this year. The combined proceeds from the three sales were €180 million, according to a source close to the firm, suggesting SWP has doubled its investment in IWP, as its initial investment was €90 million.
SVP acquired IWP in 2006, investing €90 million in the company’s debt, according to the source. It then conducted a debt for equity swap, giving it ownership of the company, and began the process of turning the business around.
This involved both operational reorganisation and changes to the company’s management team. SVP closed a manufacturing facility in the UK, as well an unprofitable Canadian business unit, and merged two UK based business units. It re-positioned the Drogerie Natura retail chain, and sold a Dutch manufacturing facility.
For the Polbita sale, SVP was advised by Allen & Overy and DC Advisory Partners, while CMS Cameron McKenna and Deloitte advised Interchem.
The IWP deal adheres to SVP’s strategy of focusing on distressed and turnaround deals. Commenting on the IWP turnaround, SVP founder Victor Khosla, said: “The sale of Polbita concludes a very successful turnaround and re-positioning of the business.”
SVP appointed former Terra Firma investor relations head Michael Hewett in July as a managing director with responsibility for business development in Europe and the Middle East. At the time of his appointment, Hewett said: “The distressed space is of great interest to investors, particularly in Europe which is going through its first meaningful distressed cycle.”