A look back at H1 2014
Against a backdrop of quite sluggish European growth – especially in France, the Eurazeo group fared very well in the first half, with almost 5% growth in its revenues from its 23 portfolio companies.
Meanwhile, Eurazeo PME’s interim result also showed a capacity to generate growth and detect new small and mid-sized companies with strong value-creating potential.
Eurazeo PME’s consolidated revenues expanded by 7.5% to 193 million euros, based on restated figures. This growth in activity was driven mainly by Cap Vert Finance, Gault & Frémont, and Vignal Systems, the latter having entered our Group in the first half. Meanwhile, Dessange International achieved top-line growth by further consolidating its US businesses, and the Léon de Bruxelles group was stable on the half, with six new restaurant openings.
In terms of profitability, the consolidated EBITDA of our portfolio companies rose by 14% to 26 million euros, driven by solid performances of our companies.
Acquisitions
Eurazeo PME continued to make new acquisitions with two new ones in the first half: Vignal Systems and Colisée Patrimoine. Companies that were already in our portfolio made six acquisitions.
Eurazeo PME invested 26 million euros to acquire Vignal Systems, a European leader in signalling lights for industrial and commercial vehicles, with 40% market share. Its growth plans are based on expanding its activity worldwide and also on the technological shift from incandescent lights to LED. This company’s growth accelerated in April 2014, just two months after its acquisition, with its merger with the Norman Company ABL Lights, who is n° 2 in Europe and in the US in working lights. This deal is speeding up the two companies’ development through strong commercial synergies in France and, especially, internationally. Their product lines are a good fit, and their management teams already work together on developments far from France. Eurazeo PME reinvested 17 million euros in this deal, which demonstrated our ability to support the consolidation of French small and mid-sized companies to produce international champions.
The other acquisition, Colisée Patrimoine, is France’s fourth-largest retirement home operator. The deal was done at an enterprise value of 175 million euros. Eurazeo PME invested 70 million euros and will hold majority stake, alongside the founder Patrick Teycheney. Christine Jeandel, the former Chief Executive Officer of Medica, has agreed to serve as chairperson of this Group. The purpose of this acquisition is take part in sector consolidation and reinforce Colisée’s fourth ranking in the sector.
Build-ups
Regarding external growth, we developed the companies in our portfolio with the aforementioned deals in France internationally. In early March, Péters Surgical, in which we have been shareholders since 2013 and which is the world’s fourth-largest surgery suture maker, announced the acquisition of the Breton company Vitalitec, the European leader in haemostatic surgical clips used to ligature blood vessels. At the same time, the group acquired a small, high-potential company called Fimed, which makes adhesive products for surgery. These deals reinforce the standing of the specialist in surgical closings, to expand its line of products, and, most of all, to stick to its international diversification, particularly in the US and Belgium.
Meanwhile, Cap Vert Finance expanded its European leadership in IT recycling by acquiring no fewer than three companies in seven months: Aditia Lease; DCS, which is an Italian competitor; and Phoenix IT Services.
And, finally, Dessange International acquired two regional master franchises in the US: Fantastic Sams in the states of Michigan and Kansas.
So the first half was quite busy in both acquisitions and in the demonstration that the companies that we accompany have the ability to expand, to develop internationally, and to be profitable. Eurazeo PME demonstrated its know-how in transforming French small and mid-sized companies into globalised and sustainable globalised mid-sized companies.
