PE firms enjoy luxury goods: HIG picks up Pinalli; KPS Capital acquires Princess Yachts

Pinalli is a distribution platform for beauty and personal care (BPC) products.

Good morning Eurohubsters, Nina Lindholm here with Friday’s Dealflow.

Private equity firms are feeling fancy. We’ve heard from a couple of sources that luxury is a resilient segment, even in a recession scenario, and there is more evidence of that as we look at deals in the consumer sector this week. HIG picked up a beauty and personal care platform, PAI Partners acquired a premium frozen desserts provider and KPS Capital took a stake in a luxury motor yachts manufacturer.

Pampered. Let’s start with a bit of self-care. HIG Capital secured a controlling stake in Pinalli, a distribution platform for beauty and personal care (BPC) products.

Pinalli, based in Fiorenzuola d’Arda, Italy, has e-commerce platforms specialised in luxury BPC products in Italy.

“Pinalli represents a great story of success, driven by strong innovation which has allowed it to constantly adapt its business model to an always evolving world, including the digitisation of business processes in an omnichannel environment,” said Raffaele Legnani, managing director of HIG in Italy. “We believe that HIG is the ideal partner to support the management team in the next stages of development of the Company in a very fragmented sector”.

You can read our full coverage on the deal here.

Italy featured a lot in my recent round-up of deals in the luxury segment. Partners Group, Bain Capital and BC Partners are among the PE firms that I included in my piece. You can check it out here.

Indulgent. Next up, we have a very tasty deal. PAI Partners will acquire La Compagnie des Desserts (LCDD), a premium frozen desserts supplier from Argos Wityu. Credit Mutuel Equity, which held 20 percent of the shares along with Argos, has also exited the firm.

LCDD is headquartered in Lézignan-Corbières, France. The firm produces artisanal ice cream and premium frozen pastries to over 23,000 food service clients across Europe, mainly in France, Spain, and the UK.

“The company is uniquely positioned to capitalise on the growing demand for outsourced dessert preparation across hotels, restaurants and catering businesses, driven by their need to innovate and manage labour shortages in the industry,” said Stefano Drago, founding partner at PAI MMF.

To find what PAI’s plans are for LCDD, take a look at our full coverage here.

PAI Partners isn’t the only firm interested in desserts. Advent International’s portfolio company IRCA is in talks to acquire Kerry Group’s Sweet Ingredients Portfolio for €500 million. IRCA is a producer of speciality ingredients for artisanal pastries, cakes and gelatos.

I caught up with Advent’s managing director Francesco Casiraghi to learn more about the deal and the speciality ingredients sector.

“Historically, the space is incredibly fragmented, with a lot of family-owned businesses in Italy, France or Germany,” Casiraghi told me. “These businesses are lacking sufficient scale, and there’s a lot of merit in driving consolidation in this space.”

You can check out my full interview with Casiraghi here.

Ahoy. Let’s jump from desserts onto a yacht. KPS Capital will acquire a controlling equity interest in Princess Yachts, a global manufacturer of luxury motor yachts. The company’s current stockholders will maintain their stakes in the firm.

Princess Yachts is headquartered in Plymouth, England. The firm employs 3,200 people.

“KPS’ investment will accelerate Princess’ growth trajectory and fund numerous investments for its future,” said Ryan Harrison, a partner of KPS Mid-Cap Investments.

The deal is likely to close in the first quarter of 2023, subject to regulatory approvals and customary closing conditions.

That’s all from me. I hope you all have a great weekend. Craig McGlashan will write to you on Monday.