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3i agrees EUR730m buy-out of Global Garden Products

Mid-market private equity and venture capital firm 3i has agreed to acquire Global Garden Products, a European manufacturer and distributor of lawn mowers and powered garden equipment, fro

Mid-market private equity and venture capital firm 3i has agreed to acquire Global Garden Products, a European manufacturer and distributor of lawn mowers and powered garden equipment, from ABN Amro Capital and AAC Capital Partners. The transaction values the business at EUR730m. Existing management, led by chief executive Pierluigi Tosato, will invest alongside 3i.

Lorenzo Salieri, a partner of 3i Italy who led the transaction, says: ‘We were very impressed with the quality of the management team. Pierluigi Tosato and his team have been highly committed and successful in creating Europe’s dominant market leader in powered gardening equipment. With the financial and strategic support of 3i, we see tremendous opportunities to continue driving the business forward in the future.’

Tosato says: ‘We are grateful to ABN Amro Capital and AAC Capital Partners for their support in building the business into a leading European player. With the support of 3i’s global network, we look forward to growing our market share further, expanding into high growth territories such as Eastern Europe and Russia and exploring opportunities of co-operation with potential partners in US and Asia.’

Marco Fumagalli, a partner and managing director of 3i Italy, adds: ‘The current situation in the financial markets is not easy and closing the deal for the acquisition of GGP required a good dose of courage and creativity. We are very pleased we will be able to work with the management team to grow the business and prepare it for an IPO.’

Antonio Corbani, managing director of ABN Amro Capital in Italy, says: ‘We are proud to have worked with the team of Pierluigi Tosato, repositioning the company from a producer of private labels to a real consumer product company with own brands and a leader in the European market. We hope GGP and 3i continue on this path of success.’

GGP was put up for sale in July by ABN Amro Capital and was the subject of a competitive auction was held, managed by UBS Bank. Following completion of the transaction, the board will include Tosato and representatives of 3i, with 3i senior adviser Paolo Antonietti as chairman and Fumagalli and Salieri as as non-executive directors.

GGP, which has headquarters in Castelfranco Veneto in Italy and 15 subsidiaries in Europe, China and Russia, is the leading European make of walk-behind and ride-on lawnmowers as well as a wide range of hand-held gardening equipment and accessories. It distributes its products in more than 80 countries worldwide but its largest markets are the UK, Germany, France, Italy and the Nordic countries.

Its leading brands include Stiga, Castelgarden, Mountfield, Alpina and Belos. The company also manufactures private label products for leading garden and DIY centres in Europe and products for original equipment manufacturers including John Deere and Honda.

The company employs around 1,800 people and sales to year ending August amounted to EUR546m with EUR84m in earnings before interest, tax, depreciation and amortisation. The company plans to invest 70 per cent of total capital expenditure and around 3 per cent of sales in new technologies and research in the next few years.

AAC Capital Partners (formerly ABN Amro Capital) has teams operating in the Netherlands, the UK and Sweden and managed EUR3.1bn at the end of June. Its main focus is to back management buyouts and buy-ins of profitable, cash-generative northern European companies, usually with a value between EUR50 and EUR500m in the industrial, services and consumer sectors.

So far in 2007, AAC Capital Partners has executed six buyouts (Dunlop Aircraft Tyres, OyezStraker, T.G.I. Friday’s, Baarsma Wine Group, Sdu and Vetus, and has recently completed exits from Fabory, TMI, Park Resorts and Iittala.

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