Moeller Group changes hands

Edited by the Engineeringtalk editorial team Jul 22, 2005

Advent International has sold Moeller Group to UK-based private equity firm Doughty Hanson and Co for Eur 1.1 billion.

Private equity firm Advent International has announced the sale of Moeller Group, one of Europe's largest suppliers of low-voltage electrical distribution and automation components for industrial, commercial and residential use, to UK-based private equity firm Doughty Hanson and Co.

The purchase price is Eur 1.1 billion including pension liabilities and financial debt.

The transaction is subject to regulatory approval and is expected to be confirmed in August 2005.

Since its acquisition by Advent in December 2003, the Moeller Group, one of the world's leading suppliers of power distribution and automation components, has achieved the turnaround on the basis of a successful consolidation strategy.

In the 2004-05 financial year, it generated sales of approximately Eur 870 million, with sales in core operations undergoing a year-on-year increase from Eur 670 million to Eur 760 million.

During Advent's tenure, Moeller has significantly reduced net financial debt to less than Eur 50 million as of financial year-end April 2005.

RaIf Huep of Advent International states: "We are delighted with the progress Moeller has made in refining its strategic focus and returning to profitability".

"Thanks to a high quality management team and strong employee base, Moeller has overachieved on the plan to refocus the business on its core strengths, increase its market penetration and take advantage of global growth markets".

"The business is in great shape today, and we wish management and employees the very best in the next phase of their development".

"We are highly optimistic about Moeller's success in the future and Advent will consider re-investing a portion of the proceeds from the sale post closing".

Moeller exemplifies one of Advent International's key strategies - focusing on improving the performance of businesses through strategic restructuring.

Post acquisition, Advent worked closely with management and two Advent operating partners (advisers from industry) to develop a value-creation plan centred on refocusing Moeller on its core components business.

Following the acquisition by Advent, Moeller concentrated on its core business as part of a consolidation strategy, and is currently registering double-digit revenue growth rates in this area.

Referring to the pending change in ownership, Theo Kubat, CEO of Moeller Holding, states: "The Moeller Group has come along extremely well since the takeover by Advent International".

"This is thanks to a refinancing concept that will put the Moeller Group on a new financial basis".

"We will be using our extraordinarily good market position - together with our future owner Doughty Hanson and Co - to pursue long-term growth".

Claus Felder from Doughty Hanson said: "High-quality engineering, strong brand names, a state-of-the-art product portfolio and leading market positions are some of the key features which make Moeller an excellent company".

"We look forward to working with management to further develop Moeller's key strengths and to take advantage of existing growth opportunities in Eastern Europe and Asia".

Advent International has been advised by the investment bank Morgan Stanley (Mergers and Acquisitions) on this transaction.