Schroder Ventures Europe, recently renamed Permira, has sold its majority stake in Domoservices, a French boiler and heating maintenance company. The business was sold to a French competitor, CGST Save, for an undisclosed amount. Dalkia, a subsidiary of Vivendi Environment, was also reported to be interested in the company. Michel Jolivet, a partner of Permira in Paris, was not able to comment about this but said: “We have achieved a very positive IRR and are pleased to have made a successful exit in the current climate.”
Permira acquired a 58.5 per cent stake in Domoservices, which maintains and repairs gas-heating systems, in a secondary buyout in November 1997. In 1991, Europe Capital Partners led the company’s first buyout from Elfi. Domoservices’ management and funds advised by Charterhouse (the French subsidiary of Charterhouse Development Capital) also invested in the 1997 transaction, which was valued at approximately euro100 million. Senior debt was provided by Citibank and Cie Financiere CIC, and Indigo Capital (previously Dresdner Kleinwort Wasserstein) supplied mezzanine finance.
Since 1997 Domoservice has improved sales and profitability. In 1998 the company appointed a new CEO, Alain Blevin (previously chairman of French boiler company Chaffoteaux & Maury). The company’s reorganisation also included upgrading it’s IT systems. Last year Bank of Scotland provided refinancing to fund four acquisitions, made between 1998 and 2000, of French companies in the heating maintenance sectors. The company now serves over a million homes from 150 offices, providing maintenance on a contractual basis to individuals and housing managers.
Permira is confident about the prospects of the new group, which will have 4,000 employees and annual sales of euro300 million. Daniel Elalouf, a principal at Permira in Paris, said: “This transaction creates a new environment for Domoservices, which will enable it to strengthen its position and to further develop its activities of maintenance services.”