Funds advised by CVC Capital Partners (“CVC”) today announced the successful acquisition of Paroc Group (“Paroc”) from its existing institutional shareholder group for an Enterprise Value of approximately €700 million.
Headquartered in Helsinki, Paroc is the leading producer of stone wool insulation in the Nordic and Baltic regions, producing building insulation and technical insulation for the residential and commercial construction markets, as well as various industrial applications. The group has approximately 2,100 employees and a pan-European sales presence, supported by 9 production facilities in Finland, Sweden, Lithuania, Poland and Russia.
In a successful 5-year period under the ownership of its current shareholder group, Paroc has grown its revenues from €317m (in 2009) to €433m (in 2013), and EBITDA from €46m to €80m, which has been achieved through organic growth. The development of the group’s higher-value, higher-margin technical insulation division, aided by investment in the group’s production facility in Trzemeszno, Poland, has represented one of the group’s success stories during this period. Most recently, the group has invested in a new facility in Izoplit, Russia, enabling the expansion of existing sales into the rapidly growing Russian market.
Kari Lehtinen, CEO of Paroc, remarks:
“The last five years have been successful, especially given the challenging economic backdrop and we are grateful to our former owners for their support during this period. We see a strong future for our business, with recovery in many of our markets expected in the coming years, and with our presence in the fast-growing Russian market. We look forward to taking Paroc forward in close cooperation with CVC, who are supportive of our strategy. CVC offer us a depth of experience and a strong track record with value-creating investments, expertise in the building materials sector and in the Nordic region. We are excited to share with CVC the next phase of our growth.”
In a joint statement, Peter Törnquist and Søren Vestergaard-Poulsen, partners at CVC, said:
“We have known Paroc as a successful and well-managed company for many years. It is recognised amongst customers for the high quality of its products and innovative solutions. Paroc has strong market positions in the Nordic and Baltic regions, and has, over recent years, expanded in the CEE region and most recently, in Russia with the establishment of domestic production in 2014. We look forward to a close cooperation with Paroc’s management in the coming years and to support them in the further development and continued expansion of the group.”
The transaction has been approved by the Group’s current shareholder group, and the completion of the transaction is subject only to the receipt of customary competition clearances.
CVC was advised by Deutsche Bank, Merasco, FTI Consulting, Freshfields Bruckhaus Deringer, Avance, BCG, Golder and Aon.
Paroc was advised by Lazard & Co., Limited, Macfarlanes, Borenius and KPMG, and the management team of Paroc was also advised by PCA Corporate Finance and Eversheds.
For further information, please contact:
CVC
Carsten Huwendiek, Head of Communications (+44 (0)207 420 4240)
Paroc
Kari Lehtinen, CEO (+358 (0) 46 876 8000)
Anders Dahlblom, CFO (+358 (0) 46 876 8000)
About Paroc
Paroc is the leading manufacturer of energy-efficient insulation solutions in the Baltic Sea region. The cornerstones of our operations are customer and personnel orientation, constant innovation, profitable growth and sustainable development. Paroc products include building insulation, technical insulation, marine and offshore insulation, construction panels and acoustic products. The products are manufactured in Finland, Sweden, Lithuania and Poland and, starting in 2014, also in Russia. The company has sales and representative offices in 14 European countries. In 2013, our net sales amounted to €433m and we employed over 2,000 people.
About CVC Capital Partners
CVC Capital Partners (‘CVC') is one of the world's leading private equity and investment advisory firms. Founded in 1981, CVC today has a network of 21 offices and over 300 employees throughout Europe, Asia and the US. Currently, CVC manages funds on behalf of over 300 investors from North America, Europe, Asia and the Middle East, amounting to over US$65 billion. CVC has during the last 30 years completed over 300 investments with an aggregate transaction value of over US$125 billion globally, of which 20 investments have been made in the Nordic region during the last 20 years. CVC has offices in Stockholm and Copenhagen.
