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Doughty Hanson Announces the Closing of Moeller Group Acquisition
Successful Fiscal Year 2004/2005
Bonn / Frankfurt, September 13, 2005
Doughty Hanson has completed the acquisition of a majority stake in Moeller Group ("Moeller") from Advent International ("Advent"), which had been announced on 20 July, 2005. Following antitrust approval, Doughty Hanson closed the transaction within the expected period of time.
The private equity firm now owns a 75 percent stake in Moeller, a leading international supplier of low-voltage electrical distribution and automation components for industrial, commercial and residential use. Doughty Hanson acquired the majority stake in Moeller for a purchase price of €1.1bn including pension liabilities and financial debt. Advent will own a 15 percent minority stake in Moeller, while the remaining shares will be held by the management.
With Doughty Hanson as the new shareholder, the management intends to consolidate the market position of Moeller and to enhance its customer relations. Moeller also plans to expand in high-growth markets. "We will support the management in the further development of the core strengths and the competitiveness of Moeller as well as in pursuing growth opportunities in Eastern Europe and Asia," said Claus Felder of Doughty Hanson. The acquisition of Moeller is in line with Doughty Hanson's strategy to acquire market-leading, mid- to large-sized businesses.
In conjunction with the acquisition, David McLemore has departed the management team of Moeller Holding GmbH, and Uwe Alwardt has switched to the company's Partner Committee. Theo Kubat (CEO), Robert Gärtner (CFO) and Joachim Göddertz, who have run the company for an extensive period, will continue in their current positions and work to achieve the continual development of the company.
Theo Kubat, CEO of Moeller Holding GmbH, had the following to say upon the completion of the acquisition: "Together with our new partners, we will continue to expand our extraordinary market position – in selected new markets, through innovative products, new developments and targeted, calculable acquisitions. Moeller will continue on its march to the top of the electronics sector. The groundwork for our objective has already been laid." The first concrete undertakings will be the opening of the new logistics centre in the Czech Republic, the erection of a production facility in India and the opening of a foreign subsidiary in Bulgaria.
Successful fiscal year 2004/2005
The Moeller Group clearly exceeded its
goals for the completed fiscal year. Moeller achieved a total turnover of
€869mn. The company's core business turnover increased from
€670mn for the previous year to €760mn. The Group's
bank liabilities declined further at the end of the fiscal year. The
operative cash flow of €71mn was €46mn higher than that of
the previous year. Following a strong first quarter, which saw
considerably growth in both turnover and result, Moeller is targeting core
business growth in excess of 5 percent and an increase in EBITDA for the
current 2005/2006 fiscal year.
Successful first quarter 2005/2006
During the first three months of the
current fiscal year (May 1, 2005 – April 30, 2006) the Moeller Group
was able to repeat last year's positive business development. The
Group enjoyed a 14 percent increase in turnover in the case of core
business and a 10 percent increase in EBITDA.
UK Comment
On the Doughty Hanson acquisition, Paul Corbett, Managing
Director of Moeller Electric Ltd, comments: "The sale of Moeller by
Advent to Doughty Hanson is extremely positive as it assures the continued
presence of the Moeller brand and its association with value for money,
high quality, innovative products. In the UK, Moeller will continue to
increase its share of the industrial control, automation and distribution
equipment markets. For UK customers it is business as usual."
Moeller Firmengruppe (www.moeller.net)
The Moeller Group, which is based
in Bonn, Germany, is one of the leading globally active suppliers of
systems and components concerned with power distribution and automation in
industrial, infrastructure and residential building applications. The
company focuses solely on core business areas, as evidenced by its five
business units, namely Automation, Command & Control Devices, Motor
Starters & Drives, Circuit Breakers and Building Automation.
The Moeller Group has a strong international alignment. Founded in 1899, the company has an efficient sales network in all relevant target markets, being represented in over 80 countries of the world by 27 national sales companies and over 350 sales offices and distribution partners. Thanks to its international production structure made up of 19 production facilities, it is able to utilize the advantages of the regional locations involved and capitalise on the opportunities offered by global growth markets.
The Moeller Group currently has around 8,000 employees, and in the 2004/2005 financial year generated consolidated sales of EUR870 million, with core business accounting for EUR760 million of this sum.
Doughty Hanson & Co (www.doughtyhanson.com)
Doughty Hanson & Co is
an independent fund management company with offices in London, New York,
Frankfurt, Milan, Munich, Paris and Stockholm.
Doughty Hanson has 25 investment professionals in its private equity unit overall. Its partners have had many years' experience in the successful management of international private equity funds and have completed transactions valued in excess of US$17 billion since 1985.
Doughty Hanson has a long track record of successful investment:
It has returned substantially in excess of US$4.0 billion to investors in Fund III at a realised gross multiple in excess of 2.4 times invested capital following the sales of Knowles Electronics, Priory Group, A.T.U, Dunlop Standard, FL Selenia and Tornos and the IPO of RHM and Umbro.
Companies remaining in the portfolio include Impress, LM Glasfiber, Knowles Electronics and North American Membership Group (NAMG), as well as a 26% stake in RHM and a 33% stake in Umbro.
Doughty Hanson has already returned over 20% of Fund IV commitments to investors, following the successful recapitalisation and initial public offering of Saft. Existing investors asked for the Fund to be capped at €1.6 billion in January 2005, given the strong performance of portfolio companies in the Fund.
Doughty Hanson has made five acquisitions from Fund IV to date: Saft,
Balta, ATU, Tumi and Moeller.