11 November 2016
Ratos has signed an agreement to divest its subsidiary Mobile Climate Control, a global supplier of complete climate comfort systems to the commercial vehicle industry, to VBG Group AB (publ), a listed Swedish industrial group. Enterprise Value amounts to approximately SEK 1,790m and Ratos will receive approximately SEK 1,375m for 100% of the shares. The divestment generates an exit gain of approximately SEK 250m, an average annual return (IRR) of approximately 10% and a money multiple of 2.2x.
Ratos acquired Mobile Climate Control (MCC) in 2007. The company is a global supplier of climate comfort systems with high demands on product performance and quality for vehicles produced in short series. The climate comfort systems are designed to customer specifications and include heating and/or cooling (HVAC) which provides a pleasant environment for drivers and passengers. Approximately 80% of the company's sales are generated in North America and the remainder in Europe as well as the rest of the world. Major production plants are located in Canada, the US and Poland.
Under Ratos's ownership, a number of value-creating strategic initiatives have been implemented, including two significant add-on acquisitions in North America, investments in production plants in Poland and Canada as well as international expansion to China, South Africa and Brazil. MCC sales has grown approximately 8% per annum since the acquisition in 2007, and sales amounted to SEK 1,264m in 2015, with an EBITA of SEK 152m.
"In 2007 Ratos acquired a successful, entrepreneur led niche company. Together with the company's management, we have strengthened MCC's market position through add-on acquisitions, investments in product development and increased productivity. We believe that MCC and VBG Group complement each other well and can benefit from their respective strengths in several areas going forward. By having a strong focus on value-creation throughout the entire holding period, despite at times challenging market conditions, we are now divesting a company, that is nearly twice as big, with good returns," says Daniel Repfennig, Senior Investment Manager at Ratos.
Ratos has signed an agreement with VBG Group to divest 100% of the shares for approximately SEK 1,375m in Equity Value. The net invested amount is SEK 622m. The divestment is estimated to generate an exit gain of approximately SEK 250m and an average annual return (IRR) of approximately 10%. The transaction is expected to be completed during November.
For further information, please contact: Daniel Repfennig, Senior Investment Manager, Ratos, +46 8 700 17 00 Elin Ljung, Head of Corporate Communications, Ratos, +46 8 700 17 20
Financial calendar from Ratos: Year-end report 2016 17 February 2017
Ratos is an investment company that owns and develops unlisted medium-sized companies in the Nordic countries. Our goal as an active owner is to contribute to long-term and sustainable business development in the companies we invest in and to make value-generating transactions. Ratos's portfolio consists of 21 medium-sized Nordic companies and the largest segments in terms of sales are Construction, Industrials and Consumer goods/Commerce. Ratos is listed on Nasdaq Stockholm and has a total of approximately 16,000 employees.
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