International private equity firm, Cinven, today announces that it has agreed to sell SLV Group (‘SLV’ or 'the Group'), the German-headquartered provider of residential and technical lighting, to Ardian, for an undisclosed consideration.
This represents the second successful realisation of an Industrials business within the last month, following Cinven's agreement to sell Italian-headquartered Avio Spazio to Space2 and Leonardo-Finmeccanica on 20 October 2016. Cinven has a strong track record in Germany; current investments include CeramTec, HEG, JOST, Synlab and Viridium.
Cinven acquired SLV in May 2011 from its founder and HgCapital. Cinven's Industrials and German teams had identified SLV as an attractive opportunity in 2010, developing a close relationship with SLV's management team which led to a 'preferred buyer status'. Cinven's Portfolio team in Asia was integrally involved in assessing the transaction, primarily focused on SLV's Asian supplier network and sourcing strategies. The insight provided by Cinven's Portfolio team in Asia, combined with Cinven's previous experience across Europe investing in asset-light business models, gave Cinven a significant competitive advantage in the process.
SLV has grown significantly since Cinven's acquisition generating a c.40% increase in sales and reflecting Cinven's well-executed investment strategy. Key achievements include:
- Strengthening SLV's management team, most importantly with the appointment of a new CEO, Robert Fellner-Feldegg, in February 2014. Robert has been instrumental in transforming SLV and positioning the business for the next phase of growth;
- Improving SLV's product development process by implementing a bottom-up, structured and scalable product innovation process and optimising the go-to-market time. Notably, Cinven's Portfolio team in Asia supported management in building SLV's first sourcing office in China;
- Developing SLV's footprint in key geographies through measured, successful and profitable expansion outside of Germany and across different channels;
- Completing the acquisitions of Unex (2014), a Swiss provider of LED lighting fixtures, Lagotronics (2015), SLV's Dutch Distribution Partner and Nordtronic (2016), a Danish provider of LED lighting products;
- Further strengthening SLV's relationships with professional electricians and installers through closer partnerships and loyalty programs; and
- Successfully repositioning and professionalising the business, creating an excellent platform for future growth in its existing markets and internationally.
Bruno Schick, Partner at Cinven, said: "During Cinven's ownership, we have worked closely with SLV's management team to deliver our growth strategy, improving product development and internal processes, completing the acquisition of three value-accretive businesses and expanding SLV internationally."
"SLV is an innovative company with a proven and successful business model. The sale of SLV is an example of another successful Industrials investment for Cinven, this time in Germany, following the recent sale of Avio Spazio in Italy."
Robert Fellner-Feldegg, Chief Executive at SLV, said: "Cinven has been an excellent partner to SLV. The team has consistently been able to provide support and guidance both in Europe and Asia, which have had a fundamentally positive impact on SLV's business performance. SLV is extremely well positioned for future growth and we are looking forward to the next phase of our development supported by my strong international team who shares a clear vision going forward."
Advisors to Cinven on this transaction included: Goldman Sachs International (M&A); McKinsey (commercial); Deloitte (financial); Hengeler Mueller (legal) and KPMG and EY (tax & structuring).