Monitor Clipper Partners, a US-based private equity firm, has sold Technal, the French manufacturer of aluminum systems used in the fabrication of doors and windows. A division of Norsk Hydro, Norway’s largest industrial group, is paying o73 million for Technal and will assume o43 million in debt. The transaction is still waiting for regulatory approval.
The acquisition of Technal from Alcan Aluminum in July 1999 was Monitor Clipper Partners’ first European transaction from its $625 million fund. The firm, which is based in Cambridge, Massachusetts and London, was formed in 1998 by The Monitor Group, a group of advisory businesses and strategy consulting firms, and The Clipper Group, a private equity investment firm. The Monitor Group is a source of investment ideas for Monitor Clipper Partners, which include Technal, and helps develop growth strategies for acquired companies.
The value of the original Technal deal was FFr510 million (around o80 million) including debt of o53 million supplied by a Chase-led syndicate, the remainder of which Norsk Hydro will assume. This is Monitor Clipper Partners’ first exit and it has returned a gross IRR in excess of 30 per cent. Oliver Markl, a principle based in Monitor Clipper Partners’ London office, said: “This has been a very successful exercise for our first French LBO.”
After MCP bought the company it put in place a new senior management team led by CEO Patrick Tanguy. He says: “Monitor Clipper Partners and Monitor have allowed Technal to restructure itself into three complementary and tightly focused business units and have provided the company with the tools to embark on an aggressive pan-European growth strategy.”
Technal is headquartered in Toulouse, France and also has operations in England, Spain and Portugal. The company designs, manufactures and markets a broad range of building systems that are used in the fabrication of a variety of products such as doors, windows, conservatories. The Technal group has an annual turnover of o250 million and approximately 1,560 employees, increased from 1,400 in 1999.
Technal will be integrated into Hydro Building Systems, which is part of Hydro Aluminium Extrusion, based in Lausanne, Switzerland. Hydro Building Systems employs 3,200 people and has operations in over 20 countries. In recent years Hydro Aluminium Extrusion (a division within the Light Metals business segment of Norsk Hydro) has made a series of international acquisitions and joint venture agreements, last year it acquired Wells Aluminum, a extrusion company based in Baltimore, US.
To date Technal is Monitor Clipper Partners’ only European deal but Markl says the firm is currently working on another, which he hopes will close before year-end.