Benettons, Investindustrial in talks to buy paper maker Fedrigoni, say sources: Reuters

The Benetton family’s Edizione Holding and private equity firm Investindustrial have teamed up to bid for Italy’s Fedrigoni in a deal valuing the paper maker at around 600 million euros ($675 million), two sources close to the matter said on Monday.

The two investors have entered exclusive talks with the paper firm, the people added. If successful, they could each take a 50 percent stake in the paper firm in the next few months, one of the sources said.

The paper maker declined to comment on the deal.

The move is the Benetton group’s latest attempt to diversify its investments. The family, best known for its clothing group, also controls travel catering group Autogrill and airport and motorway operator Atlantia.

The Benettons, who last year pocketed 1.3 billion euros from the sale of airport caterer World Duty Free, want to invest in Italian firms that have high potential to expand abroad, Gilberto Benetton, Edizione Holding chairman, said last month.

Fedrigoni, whose products include the special paper used to make euro banknotes, scrapped a plan to list on the Milan stock market at the end of 2014.

At the time of its failed listing the Verona-based group said it was aiming for a valuation of up to 560 million euros.

Edizione and Investindustrial estimate the equity value of Fedrigoni to be around 600 million euros, the second source said. The two investors are currently make a detailed study of the company in a due diligence process.

The paper maker last year acquired U.S. based Gummed Papers of America and Brazil’s Arjo Wiggins and posted core earnings of 121 million euros. Its net debt was 178 million euros at the end of 2015.