DBAG to Acquire Spheros in Secondary Buyout

Frankfurt, Germany-based Deutsche Beteiligungs‘ private equity fund DBAG Fund V is to acquire Spheros, a developer and manufacturer of air conditioning systems, engine-independent heating systems, water pumps and roof hatches in buses. DBAG will acquire the business from Baird Capital Partners Europe and Capcellence in a secondary management buyout transaction.

PRESS RELEASE

Deutsche Beteiligungs AG (DBAG) and its managed private equity fund, DBAG Fund V, announced that they will acquire Spheros Management Holding GmbH (“Spheros”) in a management buyout. DBAG and the company’s vendors, financial investors Baird Capital Partners Europe and Capcellence, as well as Spheros’ management, signed a purchase agreement to that effect yesterday. The completion of the contract is contingent upon, among other things, approval by the antitrust authorities. The parties to the contract agreed to treat the purchase price as confidential. DBAG will invest up to 15 million euros from its own balance sheet and hold a roughly 19 percent interest in Spheros. The co-investing DBAG Fund V and Spheros’ management will acquire the remaining interests.

Spheros is one of the world’s leading developers and manufacturers of air conditioning systems, engine-independent heating systems, water pumps and roof hatches in buses. Air management in buses has been the company’s core competence – for more than 60 years. Spheros’ head office is domiciled in Gilching, in the vicinity of Munich, Germany.

Spheros products are found in all types of buses – in comfortable long-distance coaches, airport buses or the bus fleets of public transportation operators.

Spheros is the global market and technology leader in this niche market, recording shares of up to 35 percent in individual segments. In 2010, Spheros generated revenues of 166.3 million euros; for the current year, revenues are forecast to rise significantly. Key markets are Europe and Latin America; the share of Asian revenues is slated to grow strongly in the coming years. Spheros largely manufactures its products in its end markets. Its six production sites are therefore spread across the globe: facilities are located in Neubrandenburg, Germany, and at five international sites (Finland, Turkey, Brazil, China and India). The company employs a staff of 680, approximately 20 percent of whom work in Germany.

“By acquiring Spheros, we are investing in a globally operating company that boasts an excellent position in a growth market – this company ideally fits our investment criteria,” said Torsten Grede, member of the Board of Management of Deutsche Beteiligungs AG, after signing the agreement today. Moreover: “We intend to back management in driving the company’s internationalisation.” Helmut Zanker, CEO of Spheros, added: “Spheros has made excellent progress with the support of its former shareowners. We want to continue that pattern of progress with Deutsche Beteiligungs AG and, for instance, successfully expand our expertise in order to offer bus manufacturers high-quality systems for all kinds of heating and climate control issues.”

Spheros’ value creation lies in engineering and in tailoring customer-specific bus climate systems. The company has a technologically differentiated, innovative product portfolio. Spheros covers all specification classes with its premium, standard and basis products, which are successfully sold both in mature western markets and in strongly growing emerging countries. Comfort and cost efficiency are key criteria for customers: Spheros addresses these needs through lightweight construction, low coolant consumption, low noise emission, reduced fuel consumption and decreased life-cycle costs.