ABN AMRO Capital’s first exit

ABN AMRO Capital has secured its first exit since the UK team was established in 1999, selling Accantia to Duke Street Capital in a £225m secondary buyout. The UK-based health, beauty and feminine hygiene group owns leading brands Lil-lets and Simple. The return on this investment is reported to be in excess of 30%.

Completed in 2000, the buyout of Accantia was ABN AMRO Capital’s first deal after the group’s formation in 1999. A management buyout from Smith & Nephew, the deal was worth a total of £171m including working capital, acquisition facilities and transaction costs.

Alongside management, led by Accantia’s CEO Geoff Percy and finance director Peter Hatherly, ABN AMRO Capital contributed £56m of equity. Senior and mezzanine debt of €115m was arranged and underwritten by Fuji Bank and the Royal Bank of Scotland. After completion the deal was syndicated to Legal & General Ventures and the Hospitals of Ontario Pension Plan.

According to Ian Taylor, chief executive of ABN AMRO Capital, the company was reviewed as an exit possibility last year but due to market weakness a refinancing package was planned instead. The approach from Duke Street meant the refinancing was unnecessary.

Since the buyout, Accantia has grown strongly, last year sales were £96m. Geoff Percy, CEO of Accantia, said: “We’ve been able to flex our entrepreneurial muscle and invest in new product development; the spirit and cornerstone of our business. Simple Facial Skincare has doubled its market value since the buyout and through our innovation, Lil-lets, our feminine hygiene brand, has brought the first major product development in 50 years to what has been a static market.”

Duke Street, investing from its DSC V fund, is backing the company’s plans for continued growth through the introduction of new product lines, supported by enhanced advertising and marketing.

“This deal marks the transition of ABN AMRO from purely a buyer of businesses to a buyer and seller of businesses but over the next couple of years I expect we’ll still be a net buyer,” says Taylor. Last month ABN AMRO Capital was on the other end of a secondary buyout transaction, acquiring Global Garden Products from UBS Capital for €555m.