Good morning Eurohubsters, Craig McGlashan here with Wednesday’s Dealflow.
Today we’ve got a little development in Bain Capital and Triton’s race to take over Finnish construction firm Caverion, then we take a deep dive into private equity investing in central and eastern Europe. Michal Rybovič of Sandberg Capital is our guide to the region.
Next we take another look at reports that CVC is making a move for parts of Cineworld and we finish with an add-on by a Mobeus Equity Partners portfolio company in the translation sector.
Bain Capital has shaved 20c off its offer price for Finnish construction firm Caverion to €7.80 per share now or €8.30 in nine months after its tender offer closes.
The adjustment is due to the Caverion board announcing a dividend of 20c per share at its annual general meeting on Monday. Bain’s offer document had said that if Caverion distributed a dividend then Bain would adjust its bid accordingly on a euro-for-euro basis.
The rival tender offer from Triton Partners – of €8.95 per share – has similar language in the documentation, so we’ll let you know if Triton follows suit.
The Caverion board last week indicated that it will likely switch its support to Triton from Bain.
Wave of deals
Today we take an in-depth look at private equity investing in central and eastern Europe, as we speak to Michal Rybovič, partner at Sandberg Capital.
As the CEE region left decades of communist rule in the 1990s, new companies began to form. “These businesses are now 30 years old,” said Rybovič. “From a private equity perspective, that’s a big wave and a lot of opportunities.”
Private equity can offer these companies not just capital but assistance with a range of business needs, said Rybovič. “Because of communism and the centrally managed economy, we missed two generations of managers” with experience in marketing, communications and other skills, he said. “Now, we have 50-year-old managers with experience.”
That group is part of one wave – older companies with strong economic fundamentals – while a second wave features newer companies, with founders aged 30-35, which have featured in some of Sandberg’s most recent deals.
Enterprise software and IT outsourcing are among the most interesting sectors to Sandberg. The investment equation of some of those businesses has changed during the last few tumultuous years.
In Serbia, for instance, businesses have benefited from nearshoring in the wake of covid, including Quantox Technology, in which Sandberg invested via its second fund. The company provides local IT specialists to countries such as the US. The fact that two of the biggest providers of such services, Russia and Ukraine, have been at war for over a year, has helped such companies in Serbia win business.
You can read the whole article here, which also looks at the increasing interest in the region from larger private equity firms from Western Europe.
Sticking with that part of the world, yesterday we wrote about a report that CVC Capital Partners is in talks to buy the eastern European and Israeli businesses of cinema operator Cineworld.
We’d asked CVC for comment but the firm declined.
The Translation People (TTP), backed by Mobeus Equity Partners, has acquired Sure Languages, a translation company.
Sure Languages is headquartered in Edinburgh, Scotland.
Chris Price, partner at Mobeus, led the investment team, supported by Jordan Kay and Issy Jackson.
“The Mobeus origination and investment team worked hand in hand with The Translation People throughout this investment into Sure Languages, having originated the deal directly during our diligence on The Translation People in 2022,” said Price.
TTP is a tech-enabled language services provider operating in the UK, France, and Germany.
That’s it from me – I’ll be back with you tomorrow.