Cognetas has the right ingredients

UK mid-market firm Cognetas has served up Diana Ingredients for a healthy €710m to AXA Private Equity, three years after buying the company from yet another private equity owner, PAI Partners.

Diana, based in Vannes, France, supplies natural ingredients for the pet food, human food & beverages and pharmaceutical industries. Cognetas is reinvesting to take a minority stake after overseeing revenue growth of over €100m while Diana has been in its portfolio.

Patrick Eisenchteter, partner at Cognetas, stated: “We are delighted to have backed a dynamic management team to develop further Diana Ingredients as a worldwide quality supplier in the industry. The work done over the last three years across the three divisions has put the business on extremely sound and robust grounds which will help sustain its continued growth.”

When the firm got its hands on Diana, in April 2004, it cost Cognetas, then called Electra Partners Europe, €270m. Previous investor PAI Partners had held a majority stake in the business since March 1990, during which time the company had expanded into the US, Latin America, Australia and Eastern Europe. By 2003 it had a turnover of €161m and currently employed 827 staff. It now employs over 1,000 people, has 17 plants worldwide, and recorded revenues of €254m in 2006 and is on course to reach €280m for 2007.

Bruno Ladrière, director at AXA Private Equity, said: “We are very excited to complete this transaction. Diana Ingredients is leader on its market segments, in particular thanks to the unmatched experience of its team, outstanding R&D capabilities, high quality products, an international manufacturing footprint and a responsive commercial organisation close to clients. Our ambition is that Diana Ingredients become a strong development platform, including through external growth, to reinforce its market positions in several product segments and regions, among which Asia, the USA and Eastern Europe.”

The sale is Cognetas’ first exit of the year. Its only other deal of 2007 has been the acquisition of Saint-Gobain Desjonquères (SGD) for €670m alongside Sagard, the French private equity house. SGD is a French manufacturer of specialised glass packaging for the cosmetics and pharmaceutical industries.