Ratos Recaps GS-Hydro

Listed Swedish private equity firm has completed a EUR 50m (SEK 473m) recapitalisation of its Finland-headquartered piping systems portfolio company GS-Hydro.

Cash-out refinancings were common in the 12-18 months preceding the onset of the liquidity crisis in August 2007. Debt was plentiful and strong performance from portfolio companies enabled private equity firms to retain ownership of a company while simultaneously realising cash through a refinancing. 2008, however, has seen just a handful of refinancing deals.

“This refinancing was made possible by GS-Hydro’s strong performance in recent years. The company has a strong balance sheet, good cash flows and its future prospects remain positive,” said Ratos’s CEO Arne Karlsson in a statement.

GS-Hydro is a leading supplier of non-welded piping systems. Its products are used in the marine and offshore industries as well as in the pulp and paper, mining and metals, automotive and aerospace, and defence industries.

Ratos acquired GS-Hydro in 2001 in conjunction with the buyout of Atle.

The company generated profit of EUR 19m on EUR 139m in 2007/8.

Source: Thomson Merger News