Marli provides Finnish exit for CapMan

The sale of Finnish beverage company, Marli Group, to Swedish alcoholic beverage manufacturer, Vin Sprit, has presented an exit opportunity for the Nordic private equity house, CapMan. The total amount of the transaction was undisclosed.

The sale is being handled in two phases. In the first phase, that has already taken place, the minority shareholders have sold their holdings in the group. The minority shareholders represent one third of the total shares of the Marli Group. Among these investors are the equity funds managed by CapMan Capital Management Oy, with around 17 per cent ownership in the group; Oy Ingman Foods Ab, Merita Capital Oy and Nordic Beverages Holding Ltd.

The majority shareowner, family-owned Finnish industrial company, Rettig Ab and the remaining individual shareholders will sell the rest of the shares during the course of the year.

Vesa Vanha-Honko, partner at CapMan, is pleased at the outcome of the deal, stating that the exit will have an effect of E3 million on CapMan’s operating profit in 2001. As a result of the exit, Finnmezzanine Fund I will generate carried interest. The funds managed by CapMan, FinnVenture Fund I, II and III, which have all invested in Marli Group, are already generating carried interest.

CapMan has invested in several stages in the Marli story, with two equity rounds and three mezzanine investment rounds. The first round took place in June 1995 when CapMan entered the beverages market with its investment in fruit juice and soft drinks company, Chymos Oy. Chymos Juomat was established to merge the soft drinks divisions of Chymos, Olvi, Suomen Marja and Ingman Foods. It was 34 per cent owned by Karl Fazer and 27 per cent by CapMan Capital Management. The existing minority shareholders in the Marli Group are in fact the original shareholders in Chymos.

As a part of the global restructuring within its confectionery branch, Marli’s majority shareholder, Rettig assigned its confectionery division to Huhtamki Oy in 1992, in exchange for Marli Oy. In 1998, CapMan effected another equity and mezzanine round when it entered into an agreement with Rettig to merge Chymos with the Marli Group. Rettig currently owns 65 per cent of Marli.

Today, Marli comprises the Finnish companies Oy Scanfrentz Ab and Oy Kjaer & Sommerfeldt Ab, with operations in Lappeenranta, Turku and Helsinki. In Denmark, the acquisition includes Vingaarden A/S, a producer, importer and retailer. The Swedish importer and agent, Gte Andersson AB, one of the major operators on the Swedish wine market with around 15 employees, is also included in the deal, as is the fruit juice company Oy Marli Ab.

Through the acquisition, V&S stands to add some 40 million litres to the 130 million litres it sold during 2000. The deal is in line with V&S’ strategy to become a leading operator in the Nordic market for alcoholic beverages and also provides substantial potential for synergy gains in production, as well as distribution and sales. Access to the whole Nordic market area also makes V&S a more attractive partner for both suppliers and buyers.

“The disposal of Marli Group is yet another step towards focusing Rettig’s business portfolio. Resources will be freed from the food industry and can be invested in metal industry and ship owning. Through the merger with V&S, the vision of a strong and interesting operator in the wine and spirits business becomes reality”, said Tom Weymarn, ceo of OY Rettig Ab.