Arle Capital Partners said Monday that they had agreed to sell Capital Safety Group to KKR in a deal valued at $1.12 billion. The transaction is expected to close in January. The sale represents an ROI of 2.7x for Arle. Capital Safety makes safety equipment to protect against falls. Arle is the former buyout arm of Candover Investments. Christian Hess and James Simpson of UBS advised on the sale.
Arle Capital Partners today announced that it signed an agreement to sell Capital Safety Group, worldwide experts in fall protection and height safety equipment, to KKR for an enterprise value of US$1.12bn. The deal is expected to complete in January 2012, subject to regulatory approvals.
The sale of Capital Safety represents a return of 3.6x since Arle began managing the investment in 2009 and a 2.7x return on the original investment. It is the third exit by the Arle team following the successful realisations of Ontex and Equity Trust. In total, the team will have realised proceeds of €728 million from these three exits.
Since Capital Safety was acquired from Electra Partners in June 2007 the business has undergone a strategic transformation, doubling its revenues to over US$350m.
In a clear example of Arle’s active approach to ownership, significant change has been effected at Capital Safety through close partnership with management. Capital Safety’s management was strengthened from Arle’s network of business leaders and a new strategy was defined and implemented. Anders Pettersson and Roland Schylit, with whom the Arle team had partnered successfully for the buy-out of Thule, were appointed CEO and COO respectively, with Joe Reimer joining as President of the Americas and Mikael Hägg as CFO.
Under this strong leadership, organic growth accelerated from a series of new and refreshed product launches and an operational optimisation plan resulted in an improved global supply chain. Capital Safety’s manufacturing footprint was in part migrated to lower cost countries. In addition, Capital Safety diversified its product and service offerings and accelerated its expansion into emerging markets with five accretive acquisitions in Europe, Australia and Latin America.
Nils Stoesser, Partner at Arle with board responsibilities at Capital Safety commented:
“The successful sale of Capital Safety is a ringing endorsement of Arle’s active ownership where we have driven through significant management and operational changes in partnership with Anders Pettersson and the team. The business is performing strongly and is well positioned for future growth. I wish the team every success”.
“Despite adverse market conditions, we have proved that it is possible to generate growth within our portfolio companies by working closely with management and playing a key role in determining the strategic and operational direction of the businesses. As a result, we have been able to deliver excellent returns for our investors”.
Advisers on the deal included:
UBS, Christian Hess, James Simpson
ERM, Andrew Bale
LEK Consulting, Simon Glucina, Peter Debenham
Deloitte & Touche, John Cox, David Quantrill
KPMG, John Oldcorn
Simpson Thacher & Bartlett LLP, Adam Signy
DC Advisory Partners, Andrew Cunningham
Notes to editors:
Arle Capital Partners
Arle is a private equity partnership formed in April 2011 following the buyout of Candover Partners Limited. Arle focuses on businesses in the energy, industrial and services sectors typically based within the North Sea Rim but with operations that extend beyond these markets. North Sea Rim comprises the UK, The Nordics, Benelux and German-speaking Europe.
Arle’s portfolio currently comprises 12 European-headquartered businesses with an aggregate value of over €10 billion. Arle’s approach is based on active ownership in close partnership with management in order to drive long term uplifts in growth and value and in turn to generate strong returns for Arle’s investors. For more information, please see www.arle.com