Epiris, the manager of Electra Private Equity, has announced the sale of Electra’s interest in Innovia Group, a manufacturer of speciality films and substrate for polymer banknotes. Innovia Group has been sold to CCL Industries in a transaction that places an enterprise value on Innovia of $1.13 billion. Espiris says that, based on current exchange rates, Electra would receive proceeds from the sale of £106 million, an uplift of £26 million or 32% and equivalent to an increase in its NAV of 52 pence per share, on the valuation of the investment at 30 September 2016. This equates to a return of 3.2x cost, and an IRR of 51%. The transaction is subject to regulatory and change of control approvals and Espiris says that it expects the transaction to close by the end of the first quarter of 2017.
Epiris invested €40 million as a cornerstone investor in The Smithfield Group’s acquisition of Innovia in 2014. Innovia is headquartered in Cumbria and operates four manufacturing sites worldwide. Espiris says that Innovia’s Security division is the leading manufacturer of polymer banknote substrate for central banks, benefiting from a strong intellectual property portfolio and a 20-year track record producing substrate for 24 central banks. Espiris also says that Innovia’s Films division is a leading global producer of speciality high performance films primarily used in packaging applications for the food and tobacco industries. According to Espiris, Innovia Films benefits from high barriers to entry and steadily growing demand. It occupies leading positions in mature niche markets and enjoys long-term customer relationships.
Electra Private Equity sells 32% stake in Innovia for circa £106m : ELTA