European Capital supports French MBO with unitranche

The €25 million financing of chemicals company Unipex follows on from previous unitranche and mezzanine loans provided by European Capital to the France-based company.

European Capital has invested €25 million in unitranche bonds to support the management buyout of Unipex Europe Solutions, a France-based distributor of active ingredients and speciality chemicals.

Unipex has been bought by its management team, chief executive Patrice Barthelmes, chief operating officer Frederic Ivsic and chief strategy officer Jean Mazeres.

Founded in 1968, Unipex has strengthened its position in Benelux and Africa in recent years via organic growth and add-on acquisitions.

European Capital has been a lender to Unipex since 2008, first as a result of a financing by Ardian, and then through the subsequent purchase of the company by IK Investment Partners in 2012.

The previous two facilities realised a 1.5x money multiple and 14.2 percent internal rate of return (IRR) between 2008 and 2012. From 2012 up to July 2015, the deals generated a 1.4x money multiple and 16.1 percent IRR.

“As a long-term Unipex partner, European Capital is very impressed by the development of the company over the past years as a result of its ability to consistently find new growth levers,” stated Etienne Haubold, managing director at European Capital Debt Management Limited.

Unipex has a long-standing presence in France through a broad array of ingredients and raw materials sourced from worldwide chemical manufacturers, enabling it to build a large portfolio of loyal customers, European Capital said.

Ivsic commented: “As majority shareholders of Unipex, the management team is very excited for European Capital's financing, as we believe their commitment will allow us to capture future market potential and further grow the core distribution business in France, as well as Benelux and Africa.”

European Capital manages two private debt funds, a senior, unitranche and mezzanine debt fund targeting €500 million, which held a second close on €318 million during the second quarter of 2015, and a £100 million ($151.7 million; € 135.2 million) UK SME debt fund.

In May 2008, the Paris-based firm extended a $22 million mezzanine facility to support the spin-off of Unipex Group from Atrium Innovations, led by AXA Private Equity, now known as Ardian. In July 2011, European Capital followed the investment with $7 million in additional mezzanine financing to support the sale of AXA Private Equity’s majority shareholding to IK2007 fund.

In September 2012, European Capital announced it received proceeds of €27.9 million from its initial loan to Unipex. It then completed an investment in a €20 million multi-currency (USD and EUR) unitranche bond supporting the acquisition of the group by IK2007 fund.

European Capital is a subsidiary of American Capital, a Nasdaq-listed asset management firm.