Electra Private Equity has agreed to sell its interest in Capital Safety Group (CSG) to KKR. The total value of the deal is approximately USD1.1 billion. CSG is one of the world’s leading manufacturers of fall protection, confined space and rescue equipment.


Completion, which is expected in January 2012, is conditional and subject to regulatory clearances, amongst other things.


Subject to completion, Electra is expected to receive proceeds in the region of GBP54 million based on today’s exchange rates. This would represent an uplift of GBP28 million or 104% on the valuation of CSG, inclusive of accrued income, at 31 March 2011. Electra is due to announce its results for the year ended 30 September 2011 on 6 December 2011.


Electra originally invested GBP30 million when it led the GBP98 million buyout of Capital Safety Group in 1998. A refinancing was put in place in 2005 where Electra realised GBP65 million and re-invested GBP20 million in the equity and mezzanine of the business. In 2007, Electra sold CSG to Candover (renamed Arle Capital Partners) in a US$565 million secondary buyout with Electra realising gross proceeds of GBP113 million and reinvesting GBP18 million to retain a 10% stake in the business in order to benefit from the growth forecast in the fall protection market. Following the initial investment of GBP30 million, CSG has generated net proceeds over thirteen years of GBP195 million for Electra; an IRR of 23%.


David Symondson (pictured), Deputy Managing Partner of Electra Partners, the Manager of Electra Private Equity PLC, says: "Capital Safety is a fantastic business that we have been proud to support for the last thirteen years.


"Thanks to Electra’s flexible investment mandate, which allows a long-term view on investments, we have been able to develop Capital Safety from a regionally focused company into the global brand leader it is today. This is a perfect example of Electra Partners’ ability to support the international growth aspirations of leading businesses.
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This is the third sale Electra has agreed in the last two months following the sale of both specialist credit card provider SAV Credit and heating treatment products manufacturer BDR Thermea.


Electra Partners refers to Electra Partners LLP acting on behalf of its client Electra Private Equity PLC.
