Cognetas Exits KSM Castings

Buyout firm Cognetas is selling automotive supplier KSM Castings to Chinese group CITIC Dicastal, Reuters reported. KSM is the last of three German companies that the firm put up for sale this month, Reuters said. No terms of the acquisition were disclosed, though estimates have placed the value of KSM at roughly 300 million euros.

(Reuters) – Private equity firm Cognetas said it was selling autmotive supplier KSM Castings to Chinese group CITIC Dicastal, as it fights to win over investors for a chance to raise new capital for deals.

The deal was Cognetas’s second since managing partner Nigel McConnell left last month amid differences over strategy, and allows it to draw its first 1 billion euro ($1.45 billion) fund to a close, with investors more than doubling their money.

The last of three German companies that Cognetas put up for sale earlier this year, the deal underlined continued appetite from large Asian groups for European manufacturing assets.

While no financial detail on the deal was disclosed, sources familiar with the situation had said previously KSM Castings, which makes the front chassis for all Volkswagen (VOWG_p.DE) Golfs manufactured globally, could fetch around 300 million euros.

Qinhuangdao, China-based CITIC Dicastal is the world’s largest manufacturer and supplier of casting aluminium alloy wheels, based on 2010 revenue. It is wholly owned by CITIC Group, one of the largest state-owned conglomerates in China.

Patrick Eisenchteter, co-head of Cognetas’s Paris office, took over leadership of the firm in June after McConnell’s departure, as it neared the end of the period defined for making investments out of its 1.25 billion euro second fund.

At the time, Eisenchteter said the firm’s focus would be on building and supporting the group’s remaining investments, which include French food ingredients business Diana Ingredients and recent acquisition Italian pet shop retailer Arcaplantet.

Cognetas has nearly 200 million euros left in its second fund to make follow-on investments in its companies.

In the longer term, the firm intends to return to the market to raise a third fund, Eisenchteter said.

Cognetas recently agreed the sale of German advertising agency Commarco to WPP and pond equipment maker Oase to Barclays Private Equity. . ($1 = 0.689 euro) (Reporting by Simon Meads; Editing by Dan Lalor)