Capza takes majority stake in EOS Corrugated Group

Capzanine acquired a majority interest in EOS Corrugated in February 2018, providing mezzanine financing alongside its equity, while chairman Philippe Ramirez and his senior managers reinvested and Eximium, the previous controlling shareholder, retained a minority holding. Banque Rhône-Alpes, Crédit du Nord, Banque Européenne du Crédit Mutuel and Crédit Agricole Sud Rhône Alpes provided senior debt at less than 3x EBITDA. Based at Romans-sur-Isère, EOS Corrugated manufactures the consumable parts that corrugated board machines wear out in production: the polyurethane anvil covers against which the cutting rules press, the rotary dies that shape the board and the belts carrying the sheets through the line. It employs 120 people, sells into more than seventy countries and recorded revenue of €10–30M in 2017 at an EBITDA margin of around 30%. Supplying several of these products together distinguishes the company from competitors offering one, since a box plant ordering anvil covers, dies and belts from a single supplier simplifies its purchasing and its technical support, and the margin reflects that each part is specified to the customer’s own machines. The group was assembled in 2013 when Rodicut acquired Bricq, formerly part of Voith Paper, under the ownership of Eximium, the holding company of Michel Baulé, who had founded and later sold to Bayer the polyurethane elastomer manufacturer Baulé Industries, the material from which the anvil covers are made. Revenue doubled over that period. Online retailing has raised demand for corrugated packaging worldwide, and the new shareholders intended to develop the business in China and the United States and to apply the same materials to automotive, ballistic and mining applications. Gowling advised Capzanine on legal matters and conducted legal, employment and tax due diligence, with Roland Berger on strategy, ACA Nexia on financial, Reporting 21 on environmental and Consultrade on industrial matters, and NG Finance on instrument valuation, while Pramex advised the sellers with EY Société d’Avocats, Advance Capital carried out vendor due diligence, Cadra advised management and Simmons & Simmons the lending banks.