Smooth Sale for Doughty
US private equity firm Vestar Capital Partners, and its associated funds, have acquired Italian automotive lubricants company FL Selenia, including its Brazilian subsidiary FL Brasil SA, from British private equity firm Doughty Hanson for £670 million (US$779.5 million). The purchase agreement was signed in mid-August and closing occurred on October 1.
The deal was structured as a 100 per cent share purchase conducted through special purpose vehicle FL Selenia Luxco SCA. Of the total payment, £470 million (US$547 million) will go directly to Doughty, while £200 million (US$233 million) will be used to pay off Selenia debt. Vestar is investing around £200 million from its own funds, and borrowing the rest from Japan's Mizuho bank and JP Morgan Chase.
Under the terms of the sale, Doughty will also receive an additional deferred consideration, depending on Selenia's continued performance or future IPO. The deal is also still subject to antitrust approval.
Doughty had acquired the Italian company from Fiat SpA in 2000 for £428 million (US$498 million). Since then it has broadened Selenia's production from a focus on automotives to providing lubricants for the marine and agricultural sectors as well.
Selenia operates under the Selenia, VS, HPX, Ambra, Paraflu, Urania and Tutela brand names. It has 16 sales outlets and four manufacturing facilities, including one in Brazil. It had sales of £477 million (US$555 million in 2002), of which 14 per cent were in Latin America.
Kirkland & Ellis International gave international counsel to Vestar Capital Partners, through partners James Learner, Matthew Hurlock and Bronwen Jones, and associates Pamela Henry and Abrielle Rosenthal.
In Brazil, it was advised by Demarest e Almeida Advogados, through partner Isabel Franco, and associates Andrea Jimenez and Flavia Warde.
The deal was structured as a 100 per cent share purchase conducted through special purpose vehicle FL Selenia Luxco SCA. Of the total payment, £470 million (US$547 million) will go directly to Doughty, while £200 million (US$233 million) will be used to pay off Selenia debt. Vestar is investing around £200 million from its own funds, and borrowing the rest from Japan's Mizuho bank and JP Morgan Chase.
Under the terms of the sale, Doughty will also receive an additional deferred consideration, depending on Selenia's continued performance or future IPO. The deal is also still subject to antitrust approval.
Doughty had acquired the Italian company from Fiat SpA in 2000 for £428 million (US$498 million). Since then it has broadened Selenia's production from a focus on automotives to providing lubricants for the marine and agricultural sectors as well.
Selenia operates under the Selenia, VS, HPX, Ambra, Paraflu, Urania and Tutela brand names. It has 16 sales outlets and four manufacturing facilities, including one in Brazil. It had sales of £477 million (US$555 million in 2002), of which 14 per cent were in Latin America.
Kirkland & Ellis International gave international counsel to Vestar Capital Partners, through partners James Learner, Matthew Hurlock and Bronwen Jones, and associates Pamela Henry and Abrielle Rosenthal.
In Brazil, it was advised by Demarest e Almeida Advogados, through partner Isabel Franco, and associates Andrea Jimenez and Flavia Warde.
It was advised in Italy by Gianni Origoni Grippo & Partners, through partners Fabio Labruna and Andrea Mazziotti, and associates Laura DePlato and Fabio Niccoli.
Partner Allan Murray-Jones, of Skadden Arps Slate Meagher & Flom LLP in London, gave Doughty international counsel.
In Italy, it was advised by Bonelli Erede Pappalardo partner Umberto Nicodano.
Published in the October 24, 2003 issue of LATIN LAWYER Magazine. www.latinlawyer.com.