Investcorp to acquire CEME Group

10 Jul 2008

Investcorp, the global provider and manager of alternative investment products, announced today that it has agreed to acquire CEME Group, a leading producer of components for fluids control. The terms of the transaction were not disclosed.

CEME will be acquired from Barclays Private Equity, which bought the CEME Group in September 2005. The current management team will also reinvest in the company.

Headquartered in Carugate in Lombardy, Italy, CEME is the global market leader in solenoid pumps and valves for domestic appliances. Trading under the Ulka brand, CEME’s Coffee Division produces mission critical components for all leading manufacturers of domestic espresso machines, while the company’s Appliances Division is the market leader in components for household equipment such as valves for steam ironing systems and condensing gas boilers. Its third business area, the Industrial Division, produces solenoid pumps and valves for 50 different industrial applications in the water, welding, refrigeration and gas.

Tito Soso, a Partner in Investcorp’s private equity team, commented: “CEME has built a leading market position with a blue chip customer base, serving every leading domestic coffee machine and steam ironing systems manufacturer in the world. The company symbolizes many of the strengths and flexibility of Italian engineering and manufacturing. We look forward to supporting the management team to make the most of the continuing organic growth potential in and outside Europe, as well as exploring further acquisition opportunities.”

Marco Boraso, Chief Executive Officer of CEME, added: “Investcorp has a long track record of being a supportive, value-added investor in mid-market companies in Europe and North America.  It will be a strong partner to work with over the next stage of CEME’s growth, as we continue to excel in our core business, continue to expand our product and application range internationally, and to further reinforce the Group through additional acquisitions.”

Marco Pennisi, Director of Barclays Private Equity, commented: “CEME has achieved a remarkable performance and has been run by a strong management team. BPE has confirmed again its role as private equity house supporting the growth and value creation of mid-size companies”.

The debt financing was underwritten by ING and Mezzanove.

The transaction is expected to close in July 2008.

About CEME
CEME S.p.A. was founded in 1974 and focused initially on solenoid valves for industrial applications, progressively expanding its product range to offer a wide range of components for fluids control in steam, water, gas and air applications. CEME S.p.A. is organised in three business units. The Appliances Division develops and produces components for household appliances, as well as for H.V.A.C. The Coffee Division develops and produces vibration pumps and has become the leader in the market for domestic coffee machines through the acquisition of Ulka S.p.A. The Industrial Division sells solenoid valves and pumps for 50 different industrial and professional applications through a worldwide network of 80 distributors,

CEME employs 466 employees and manufactures its components in six state-of-the-art production facilities in Italy and China. Revenue in 2007 was Euro 113.1 million. 

About Barclays Private Equity
BPE was established in 1979 and now has four European offices: it has a successful track record spanning over 25 years and has invested in over 350 businesses. Typically it invests around Euro 750m per annum in 10-15 transactions. Its investment in individual transactions ranges between Euro 10m and Euro 200m.

BPE invests as a strategic partner alongside management teams, working together to build and realise shareholder value. It has a strong focus on change of ownership deals and has a core focus on businesses with an enterprise value of between Euro 25m and Euro 250m.

The buy-out business is currently investing the Euro 2.4 billion Barclays Private Equity European Fund III, which closed in September 2007.