Block Watne Group, one of Norway’s leading housebuilders, has signed an agreement with the Industri Kapital 2004 Fund to buy 100 per cent of the shares in Prevesta, Sweden’s leading produc
Block Watne Group, one of Norway’s leading housebuilders, has signed an agreement with the Industri Kapital 2004 Fund to buy 100 per cent of the shares in Prevesta, Sweden’s leading producer of prefabricated houses. In 2006, Prevesta had a turnover of SEK1,756m (EUR189m) and an operating profit of SEK191m (EUR21m).
The purchase price amounts to SEK1.9bn (EUR204m), including the transfer of debt and shareholder loans of SEK381m (EUR41 million). The consideration consists of SEK1,215m in cash (EUR131m) and 6,502,242 shares in BWG (representing 12.6 per cent of the total shares after the transaction).
Through the transaction, which is subject to approval by the Swedish Financial Supervisory Authority and the Luxemburg Financial Supervision Commission, the Industri Kapital 2004 Fund will become one of the largest shareholders in BWG.
Since the fund acquired Prevesta in 2005, a significant restructuring effort has taken place, including the introduction of the Myresjöhus and SmålandsVillan brands to meet the needs of different customer groups, and production rationalisation including the introduction of common product platforms and brand independent production.
Investment has been made in additional production capacity, including a new factory in Sundsvall, and efforts focused on project development. Together with satisfactory market development, these initiatives have helped Prevesta become a leader in Sweden measured both by the number of single-family houses delivered and turnover.
Says Industri Kapital partner Michael Rosenlew: ‘Prevesta has been a fantastic investment for us. The company has improved its financial performance and strengthened its position in Sweden, and the recent investments and restructuring efforts have created the foundation for further growth and profitability for the company. We are also pleased to become a major owner in BWG. The combined company has excellent prospects for further successful growth and development.’
Lars Nilsen, president and chief executive of BWG, says: ‘BWG has screened the market for possible acquisition targets outside Norway. Prevesta, with its excellent brands Myresjöhus and SmålandsVillan, fulfils all the criteria BWG have defined for the evaluation process.
‘Prevesta’s management has shown strength and ability to take action by turning the company into a high performer, displaying an ability to grow the business without margin erosion and creating a financially sound operation. The acquisition of Prevesta rests on a strong industrial logic and provides the foundation for future profitable growth for BWG.’
Prevesta chief executive Mikael Olsson adds: ‘The recent years have been an exciting time for the company and the restructuring effort during Industri Kapital’s ownership has resulted in considerable investments and a strong financial performance.
‘We are pleased that the new owner of Prevesta will be BWG, a successful industrial partner with a long-term focus. The two companies complement each other well in particular in terms of know-how and market positions and we look positively on the future.’
Industri Kapital is a European private equity firm with Nordic roots that manages nearly EUR4bn in fund commitments and has acquired 64 European companies since 1989. The current portfolio encompasses 24 companies with a total turnover close to EUR8.6bn. Industri Kapital invests mainly in mid-sized companies with strong cash flow and profit improvement potential, operating in mature industries with fundamental underlying growth.
The Prevesta Group, headquartered in Myresjö in the province of Småland has built more than 80,000 houses since its launch in 1927. The company has production facilities in Myresjö, Vrigstad and Sundsvall and currently has around 530 employees.
One of Norway’s leading housebuilders, Oslo stock exchange-listed Block Watne Group undertakes the purchase and development of sites as well as the construction and sale of dwellings to private buyers. The group has built more than 80,000 homes in total, completes more than 1,000 new houses a year, and has a stock of building land corresponding to some 12,000 dwelling units. Its 2006 turnover was NOK1,529m (EUR187m) and operating profit was NOK241m (EUR29m).
