Arle to acquire Innovia Group
Private equity firm Arle Capital is to acquire the Innovia Group from the Candover 2001 Fund, which Arle has managed since 2009, for an enterprise value of EUR498 million.
Innovia, headquartered in Wigton, Cumbria, is an international manufacturer of speciality films for its key markets of labels, overwrap, packaging and polymer banknote substrate. In early 2014, Innovia Security procured the Bank of England contract to supply substrate for the new polymer GBP5 and GBP10 notes.
Arle has raised fresh capital to fund the transaction from a syndicate of global investors. For the Candover 2001 Fund investors, it represents a return of 2.1x the original investment and an uplift of 3.5x since Arle took on management of Innovia in 2009. Earlier this year, Arle also refinanced the business and raised EUR340 million by way of a high yield bond.
Richard Booth, investment director at Arle, says: “Today’s transaction represents an attractive outcome for all parties and we are delighted to be investing in such a unique business. Under Arle’s management, Innovia has focused on product development and innovation in its core markets which has delivered strong profit growth against a difficult economic backdrop.
“With the acquisition last year of the JV interest in the security division, Innovia Security now fully sits alongside the films business. Together, they have an exciting organic growth profile which Arle will support through significant investment in new capacity for both the films and the security businesses.”
David Beeby, chief executive of Innovia Group, says: “Innovia has undergone a significant transformation in recent years. Today we have a wide range of brands and trademarks with market-leading technology which provide an excellent platform for growth. We are delighted that we will continue to work alongside Arle and a new syndicate of investors who are as energised about our future prospects as we are.”
The sale of Innovia represents the final realisation in the Candover 2001 Fund following Vodafone’s announcement to acquire ONO in which Arle had a minority stake.
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