Aurica Capital raises 140 mln euros for third growth equity fund

Aurica Capital has raised 140 million euros for its third growth equity fund. The target is 150 million euros. Aurica III focuses on small to medium-sized companies in Spain that have revenues over 30 million euros and EBITDAS of more than 5 million euros. So far, the fund has invested in two companies: Delta Tecnic, a manufacturer of masterbatches for the cable and PVC industries; and Flex, a provider of bedding products. 5Capital is serving as the fund’s placement agent.

PRESS RELEASE

Barcelona, April 20th, 2017

Aurica Capital has announced the closings of its first two deals for its third growth equity fund targeting Spain-based SME companies, while reaching investor commitments totalling Euro 140 Million for this new fund. Aurica Capital specializes in growth capital for Spanish companies with revenues in excess of Euro 30 Million and EBITDAs of greater than Euro 5 Million, through significant stakes with control mechanisms.

In April 2017, Aurica backed Delta Tecnic, a fast growing niche manufacturer of masterbatches for the cable and PVC industries. One of the leaders in its sector, the Company has revenues of over Euro 40 million and a presence in over 60 countries. With Aurica’s 40% stake in the Company, it now plans to grow its manufacturing capacity, reinforce its management team and to increase its international presence.

Recently, Aurica has also taken a 20% stake in Flex, a Spain-based leading manufacturer of bedding products. The Company has grown its revenues, on both sides of the Atlantic, from Euro 200 Million in 2011 to over Euro 320 Million in 2016, while strengthening its position in the luxury mattresses and bedding segments. With the entry of Aurica, the Company will further grow its production capacity and improve its international presence in both the Americas and Asia.

“We are very excited about investing in both Flex and Delta Tecnic, after having looked at nearly five hundred deals to date for the new fund”, said Ivan Plaza, Principal, Aurica Capital. We have known the companies and their teams for many years and it a privilege for us to team up with them. Flex is over a hundred years old and typifies an incredibly successful Spanish business, which has become global, over time. With the management of the Company, we now plan on executing a buy and build strategy and further growing the product lines and increasing our market share in the US, LatAm and Asia. In Delta Tecnic, we have truly partnered with a global leader in the niche category of masterbatches for cable and PVC. We see a great opportunity to acquire smaller players in international markets and to achieve organic growth and improvements in the bottom line.”

Aurica III represents the third investment cycle for Aurica Capital, which originally started investing growth capital in 2000. Aurica Capital has made over 19 investments in its prior two investment periods and has fully exited 17 of these companies. These investments have outperformed both the private capital and the public equity comparables in Spain, during the same period.

On the fundraising side, with Euro 140 million in commitments, Aurica III is a step away from its target of Euro 150 Million and the hard cap of Euro 200 Million. In addition to a Euro 74 Million commitment from Banc Sabadell, Spain’s fourth largest bank and the anchor investor in the fund, Aurica has now received commitments from several institutional investors, including pension funds and insurance companies and multiple family offices.

Aurica also leverages its deep relationship with the Banc Sabadell group through an exclusive deal sourcing agreement. Auirica Capital’s relationship with Banc Sabadell goes back to 2000, when it started off as the private equity arm of this leading Spanish bank. The current agreement with the bank also gives Aurica a unique access and detailed insight into the Spanish small and medium companies and enables it to pursue bilateral proprietary deals, that are not available to the broader market.

“We are delighted with the progress Aurica has been making on the fundraising and the deal side. Both the anchor and the institutional investors clearly see the differentiation between Aurica and most other Spanish funds as a result of its access to under-the-radar deals and a distinguished track record of preserving and growing equity value and underlying companies, in the challenging 2008-2014 period,” Allan Majotra, Managing Partner at 5Capital, Aurica’s global placement agent, said in a statement.