Ukrainian private equity fund Western NIS Enterprise Fund has realized its investment in Slobozhanska Budivelna Keramika (SBK), a Ukrainian ceramic brick manufacturer. The transaction is one of the largest private equity exits in the Ukraine and is the first time a leveraged re-capitalization has been used in the region.
WNISEF sold its 100% stake in a secondary buyout to Raiffeisen Investment AG of Austria (RIAG) and MARA Beteiligungsverwaltungs GmbH (a holding company of RIAG). The transaction, valuing SBK at $13.5m, provided WNISEF with a return of two and a half times its investment.
WNISEF’s initial investment proceeds were used to fully reconstruct one of the two production lines with modern, energy efficient and fully computerized equipment, capable of producing 30 million bricks façade bricks annually. In response to an increased demand for SBK’s products, WNISEF made a subsequent investment in SBK in 2001, allowing the company to modernize its second production line. As a result, SBK doubled its sales and production capacity to 60 million bricks per year. Another brick plant of similar capacity was acquired the following year in Kharkiv, Ukraine’s second largest city. It too was renovated with modern and energy efficient equipment, and began operations in July 2003.