Good morning Eurohubsters, Craig McGlashan here with the Dealflow.
There are no signs yet of a major end-of-year slowdown, with plenty of deals, potential deals and data to get through.
Riverside double. We start things off by taking a look at two deals from the Riverside Company. The firm signed a definitive agreement in mid-November to acquire a controlling stake in BioDue, an Italian company that develops, manufactures and commercialises food supplements, medical devices and cosmetics.
PE Hub Europe’s Nina Lindholm spoke to Damien Gaudin, partner at the lower mid-market-focused private equity company, to find out more about the deal.
BioDue, based in Sambuca, provides customers with a full-service offering, ranging from raw material sourcing development and formulation, through production, packaging and regulatory affairs, to commercialisation.
“Italy is at the forefront of the industry in Europe,” Gaudin told Nina. “It has the highest consumption per capita of nutraceuticals in Europe. Therefore, it’s no surprise that you have some significant players in terms of size and technology active in the sector, BioDue being one of them.”
The nutraceuticals industry has proven to be resilient, according to Gaudin, as it is fuelled by demographic tailwinds such as growing populations and ageing populations, as well as some diseases becoming more prominent. That has led to an increasing focus by consumers on health and wellness, “therefore driving demand for new nutraceutical products that need to be manufactured”, Gaudin explained.
As healthcare and consumer are two of Riverside’s core sectors, BioDue fits well in the firm’s portfolio. “Nutraceuticals are at the crossroad between consumer and healthcare,” Gaudin said.
Click here for the full interview, which includes info on the type of add-ons Riverside is considering for BioDue, as well as its geographical plans and Gaudin’s thoughts on the broader nutraceuticals sector.
Tasty deal. The other deal from Riverside is straight out the oven this morning. The company announced that it had acquired Canuti Tradizione Italiana, a family-owned producer of frozen pasta for the food service market. The deal is an add-on to Riverside’s purchase of Il Pastaio di Brescia earlier this year.
Canuti has grown since its acquisition by the Toffano Pagnan family in 2015, with more than 45 percent of its products now sold internationally, in 35 countries.
Riverside plans to further internationalise Il Pastaio di Brescia, increase its production capacity, implement operational improvements, grow through add-ons – like Canuti – and focus on ESG.
“Canuti is the perfect addition to Il Pastaio, and will help drive further expansion and capitalise on the global popularity of the trend for ‘Made in Italy’ cooking experiences and quality food ingredients,” said Karsten Langer, managing partner of Riverside Europe, in a statement.
Private equity investors seem to have a taste for products with the ‘Made in Italy’ label. Investindustrial outlined its plans to evolve Italian marketplace chain Eataly into multiple formats to fit a variety of markets and locations to PE Hub Europe back in October.
Testing the market. EQT’s Infrastructure V fund entered exclusive negotiations to take a majority stake in calibration laboratory firm Trescal. OMERS Private Equity, which bought a majority stake in Trescal for around €670 million from Ardian in 2018, will re-invest for a 25 percent holding.
Trescal provides regulated calibration services for testing and measurement equipment in sectors such as transport, healthcare and telecoms, among others. The company has an annual turnover of around €450 million and a network of 380 facilities in 29 countries. Headquartered in Paris, it became an independent company in 2007, having previously been part of Air Liquide.
“Trescal provides mission-critical services to its industrial customers in essential end-markets that are experiencing increasingly stringent requirements,” said Thomas Rajzbaum, managing director and head of EQT’s French infrastructure advisory team, in a statement.
Read more on the deal here, including EQT’s plans for Trescal and its growth under OMERS.
Liquidity events. While OMERS is planning an exit (albeit with a reinvestment) and we have seen a bit of exit action lately, such as Adelis divesting from Mobilhouse, the outlook for leaving investments is tricky, according to law firm Dechert’s 2023 Global Private Equity Outlook, released this week.
“In many instances, sellers remain wedded to the rich valuations at which they marked their assets last year and are reluctant to part with these at the prices that buyers are willing to offer today,” the report read. “Until there is a marked macro improvement, with inflation showing signs of topping and therefore less need for central banks to pump the brakes with monetary tightening, it should be expected that headwinds will persist.”
Among respondents from EMEA, the two biggest challenges expected for exiting investments in the next 12 months were “securing a buyer willing to pay the desired valuation in a sale amid a depressed/risk-off market” and “determining the right type of exit (e.g., IPO vs. auction vs. negotiated sale)”.
Software plug-in. TA Associates-owned DL Software, a group of software providers, has added unified commerce platform Openbravo, the firms announced.
Openbravo, headquartered in Pamplona, Spain, is a cloud-based system that provides services including order management and a real-time view of customers and inventory. Its customers include BUT, Decathlon, Flunch, Norauto, Sharaf DG, Toys ‘R’ Us Iberia and Zôdio, and it is present in over 50 countries.
Final whistle. There seems to be a never-ending stream of sports M&A news of late, with the Financial Times reporting yesterday that the Qatari owners of French football champions Paris Saint-Germain are targeting a valuation of more than €4 billion for the club and are in talks with several investors over a sale of up to 15 percent, including with at least two US-based funds.
We also wrote yesterday about potential private equity interest in a cricket tournament, which made me realise that we should run another of our headline competitions, like we did with the news on Pink Floyd’s back catalogue back in August.
Send your best cricket/private equity headlines to me at firstname.lastname@example.org and the best ones will get a shout-out in the Dealflow.
That’s all for today – chat to you tomorrow.