Business News
GermanCapital and Morgan Stanley Support Management Buy-in of Phoenix Dichtungstechnik From Continental
Monday 04. August 2008 - - Successful Company Phoenix Dichtungstechnik (PDT) to be Independent and Headed by Experienced Management - Investment Volume to be Increased by 50% - Focus on Organic Growth and Internationalisation - No Changes for PDT Employees
As part of a management buy-in, the investment house GermanCapital GmbH and the investment bank Morgan Stanley have, together with buy-in managers Gregor Ellegast and Jürgen Werner, taken over Phoenix Dichtungstechnik GmbH (PDT), a subsidiary of ContiTech AG (Continental AG). PDT is a successful manufacturer of high-quality seal technology with a turnover of approximately EUR 65m. The company employs around 250 employees in Waltershausen (Thuringia) and Hamburg. The takeover will not affect employees. The price of the transaction remains undisclosed.
“Our company has consolidated its market position over a number of years and has been able to achieve leadership in production technology. We are convinced that, thanks to our new co-owners, GermanCapital and Morgan Stanley, we can realise great potential in the organic development and internationalisation of our business,” said Gregor Ellegast, one of the new PDT managers.
Gregor Ellegast and Jürgen Werner have been active at Phoenix for a considerable time and have strong relationships with PDT’s senior management. In addition, both are experienced managers with an international profile and have already successfully completed a management buy-out together. “PDT has leading technology and unique products. We are therefore confident that we can continue to increase turnover and profit on this basis,” said Werner.
PDT is active in a range of markets, yet maintains its focus on the roof sealing and profile sealing markets. PDT is a worldwide leader in the tunnel sealing market. In the roof sealing market, its product RESITRIX is a well-established and sought-after product. The company is active in attractive product segments within all markets covered.
“We had already explained in the takeover agreements with Phoenix that we were looking for a suitable buyer for Phoenix Dichtungstechnik, as this division does not fit into our core business,” said Gerhard Lerch, Chairman of the Executive Board of ContiTech AG. “Today’s decision is a positive result for the employees and both companies.”
Armin Weiland, Partner at GermanCapital, said: “Phoenix Dichtungstechnik is an exceptional addition to our existing portfolio of mid-cap European companies. We expect PDT to grow and will make targeted investments in its expansion. We will increase the investment volume in a sustainable way, and so support the management in developing additional markets of interest.”
Oliver Kehren, responsible for the European business in Morgan Stanley’s Special Situation Group, commented: “We give long-term financial support to expanding mid-cap companies, and are convinced that in financing Phoenix Dichtungstechnik GmbH, we are investing in a company that is a leader in its production base of Germany.”
The purchase was financed by a combination of equity and debt capital. Debt capital was provided by Investkredit Bank. Legal advice was provided by Latham & Watkins and Paul Hastings throughout the transaction.