3i, Skandia Investment and Hörnell Teknikinvest have agreed to sell Hörnell International to 3M in a debt-free SEK 750m deal. 3i reports that the deal will return more than 10 times the original amount invested. 3i and Skandia Investment both held close to a 30% stake and Hörnell Teknikinvest, the high tech investment company owned by the company’s founder Åke Hörnell, held the remaining 40%.
The investment in Hörnell, which develops manufactures and markets advanced personal protective equipment for the face, head and respiratory system, dates back to 1996. “Hörnell’s sales were SEK 150m in 1996 and the profit before tax amounted to SEK 20m. Through active and long-term ownership the company’s sales and profits have developed in an excellent way,” says Magnus Hardmeier, partner at Priveq Partners, the advisor to Skandia Investment.
In 1996 Swedish investors Skandia Investment and Swedetech each acquired a 30% stake in Hörnell from founder Åke Hörnell. Swedetech is a 1993 vintage fund of SEK 175m originally backed by listed Swedish investment firm Atle and managed by Euroventures. 3i became the fund’s single limited partner following its acquisition of Atle in 2001. Last April the merger of Euroventures and Nordico formed Accent Equity Partners, which took over the management of the holding in Hörnell. Priveq Partners advises the Skandia Investment private equity fund, whose investors include Skandia, the Fourth AP fund, Handelsbanken Liv, ICA and Orkla.In 2002 Euroventures achieved a partial realisation of the Hörnell investment through a recapitalisation. The company restructured its balance sheet with an injection of SEK 270m in senior debt from Handelsbanken and a vendor loan of SEK 100m, of which Euroventures financed SEK28 million.
Based in Gagnef, Sweden, Hörnell recorded sales of SEK 370m in 2003. The company’s product portfolio comprises auto-darkening helmets, respiratory protection systems and a line of Speedglas and Adflo-branded accessories. Sales to welders are made through distributor networks in 60 countries worldwide; world market share is approximately 40%.
Carnegie Investment Bank acted as financial advisor to Hörnell’s main shareholders.