It was a very active year in all of Industri Kapital’s markets in 2007, with four new investments, a speedy fund raising process for its €1.675bn Industri Kapital 2007 Fund, and eight full realisations and one recapitalisation, generating total realised proceeds of almost €1.8bn. The three exits from the Industri Kapital 2004 Fund – comprising DSI, Prevesta and Consolis – have generated a return of 7.6x.
Industri Kapital conducted a first closing in excess of the target and fully allocated the Industri Kapital 2007 Fund after just three months of marketing, which was formally started in mid-February when the PPM and due diligence materials were distributed to existing Industri Kapital investors and a select group of new investors. The first close, which was in excess of the target, took place on May 3 2007.
“We kept the 2007 Fund open in the summer in order to accommodate certain investors’ investment committee schedules, and the final close for investors took place on August 9 2007,” says Björn Savén, Industri Kapital’s chairman and chief executive based in Stockholm.
The latest fund’s focus will be on majority investments in high-quality, market-leading, medium-sized companies in growing industries in the Nordic region and Continental Europe. The target countries are Benelux, Denmark, Finland, France, Germany, Norway and Sweden.
“An important element of the firm’s strategy is to acquire companies that are leaders in their local markets and to transform them into regional or pan-European market leaders through geographic expansion and significant strategy and operations improvement,” says Savén.
“Given the high demand from our existing investors and with our disciplined fund size of €1.25bn and hardcap at €1.6bn, there was limited capacity for new investors. More than 70% of the investors (by number) in the Industri Kapital 2007 Fund are existing investors – 78% by total commitments (capital) in the new fund is from old investors,” he says.
Investor that joined the Industri Kapital 2007 Fund are: AIG; bcIMC; HarbourVest; Länsförsäkringar; Metlife; NYSTRS; Pantheon Ventures; Partners Group; Skandia; Standard Life; SVG; Tapiola and Varma.
Industri Kapital’s key investments in 2007 started off with its acquisition of Attendo, a care company for elderly and disabled people in the Nordic region. In February, Magotteaux, a supplier of grinding media and castings used in the cement, mining, aggregate and dredging industries in Belgium, was acquired.
In March, Industri Kapital bought Finland’s Moventas, a manufacturer of industrial and wind turbine gears as well as provider of gear maintenance and service.
Then in August, the first investment of the Industri Kapital 2007 Fund was announced: German company Schenck Process, a market leader of solutions in measuring and process technologies in industrial weighing, feeding, screening and automation.
Key exits in 2007 started off with Consolis being sold in March 2007 to LBO France; Gardena was sold to Husqvarna in the same month; Prevesta (10x return) was sold to Block Watne Group in May; Elektrokoppar was sold to Liljedahlsbolagen in June; CEVA Santé Animale was also sold to management in June; F Group was sold to DSGi plc in December 2006; Eltel Networks was sold to 3i in August; and DSI in was sold to CVC Capital Partners in October.