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3i makes partial realisation on Imaginarium

3i has reduced its stake in Spanish toy manufacturer, Imaginarium. L Capital, a development capital fund backed by Bernard Arnault’s LVMH luxury goods empire will buy a 40 per cent stake in Step Two SA, the holding company for the toy retailer. Financial terms of the deal have not been disclosed. 3i acquired a 35 per cent stake in Step Two, SA in 1994 for an undisclosed sum. The firm will retain a nine per cent stake in the company. Management and individual investors hold the remaining 51 per cent.

With 3i’s backing, Imaginarium has grown from four stores to over 200 in the past eight years. The group now has a strong position in the toys market worldwide with stores in 15 countries and spanning four continents. Last year Imaginarium made net profits of €4.3 million, up 17.8 per cent on sales up 42 per cent to €67 million. With its new funding the company will follow an ambitious expansion plan rolling-out into three new countries each year.

It is also hoped the deal will reinforce Imaginarium’s position in its legal battle with US chain Toys R US, which three years ago bought a New Jersey-based toy chain of the same name.