Arle Capital Partners Ltd., a London-based private equity firm, has agreed to buy Innovia Group for an enterprise value — the group's market capitalization plus other elements such as debt, minus cash — worth 498 million euros ($689.4 million).
Innovia, the Cumbria-headquartered specialty films manufacturer, is currently owned by the Candover 2001 Fund, part of an investment trust which Arle said it had managed for the past five years.
The deal to buy Innovia, which among other products makes the substrate for the soon-to-be-issued polymer £5 and £10 notes, was being backed by global investors after Arle said it had raised new capital to acquire the business.
The firm said it had refinanced the business earlier this year, raising 340 million euros ($470.6 million) via a high-yield bond.
Arle’s investment director Richard Booth said the deal represented “an attractive outcome” for all parties.
“We are delighted to be investing in such a unique business. Under Arle’s management, Innovia has focused on product development and innovation in its core markets which has delivered strong profit growth against a difficult economic backdrop.”
Booth said that with the acquisition last year of the joint venture interest in the security division, Innovia Security now sat fully alongside the films business.
“Together, they have an exciting organic growth profile which Arle will support through significant investment in new capacity for both the Films and the Security businesses.”
David Beeby, chief executive of Innovia Group, said his company had undergone a significant transformation in recent years.
“Today we have a wide range of brands and trademarks with market-leading technology which provide an excellent platform for growth.
“We are delighted that we will continue to work alongside Arle and a new syndicate of investors who are as energized about our future prospects as we are.”
Innovia Group employs 1,600 people across two divisions – Innovia Films and Innovia Security – and operates six manufacturing sites located in the U.K., the U.S., Australia, Belgium and Mexico.
Innovia recently announced 40 million pounds ($67.2 million) worth of investment on its Wigton site. Half of the funs will be used on a “state-of-the-art” gas turbine to increase the production of its biaxially oriented polypropylene films by 10 percent.
The other half will go to support production of polymer bank notes for the Bank of England. The company expects to add 70 to 80 jobs at the site.