Onex to invest in European market

A deal to acquire a German maker of plastic processing machinery will be the first European-based investment from the firms’ $4.7bn third fund.

Onex Corporation has agreed to buy KraussMaffei, a German manufacturer of machinery for processing plastics, for €568 million, it said in a statement. 

The transaction, which will be made from the $4.7 billion Onex Partners III fund, is expected to be completed in March 2013.

It will be the first European-based investment for this fund.  After this acquisition, the fund will be approximately 60 percent deployed. The fund will use about $340 million of equity in the deal, of which Onex’ share is about $86 million as a limited partner in the fund, Onex said in a statement.

Onex has not been an active investor in Europe in the past. Earlier this year it opened an office in London. Onex managing director Seth Mersky told Private Equity International at the time the London team would be looking for investment opportunities in the UK, French and German markets.

KraussMaffei has about 4,000 employees and has manufacturing facilities in Germany, Switzerland, Slovakia and China. The business, which is headquartered in Munich, generated approximately €1 billion in revenues from 30 June 2011 until 30 June 2012. 

“KraussMaffei is the first European-based investment for Onex Partners III and like many of our existing businesses, serves markets globally”, said Tony Morgan, a managing director at Onex in London. “I look forward to working with my colleagues to find similar investment opportunities as we build our business in Europe.”

Onex is a North American private equity firm focused on private equity, real estate and credit securities. The firm manages about $14 billion, of which $9 billion is third-party capital.