31 March 2008, Bucharest - Advent International, a leading global private equity firm, today announced that portfolio company Dufa Deutek (Dufa), Romania’s largest decorative paints producer, has successfully acquired Bengoss Comimpex SRL (Bengoss), a Romanian dry mortar and core adhesives producer, for EUR18.9 million.
Dufa enjoys a 20% retail market share and has one of the strongest distribution systems in the industry, operating through an impressive national network of 30 carefully selected local or regional distributors, which in turn supply 1,500 wholesale and retail outlets. The acquisition is a complementary strategic fit for Dufa, offering excellent opportunities to broaden the product portfolio. The combined entity will benefit from raw material cost savings, economies of scale and decreased administration and distribution costs.
Bengoss, which has been in operation for 10 years, has a 5% market share. Dufa’s well-established sales platform will allow Bengoss to reach five times as many stores as it does currently, at virtually no extra cost. The combined companies expect to achieve turnover of EUR 65 million for 2009.
Cornel Stan, founder of Bengoss, who will remain with the company as a strategic consultant, said: “Following several months of negotiations it became very clear that Dufa and Advent International were the right partners to help us with the future development of our business.”
Emma Popa-Radu, Head of Advent’s Bucharest Office, said: “Our recent investment in the pharmaceutical business LaborMed and Dufa’s acquisition of Bengoss demonstrate Advent International’s commitment to growing companies in the region. We invest in companies that want to become market leaders. Our expertise in the Romanian market and specific knowledge of the construction material market, through our investments such as Ceramica Iasi and Bolix Poland, will undoubtedly benefit Bengoss.”
The Advent team on the deal was Emma Popa-Radu and Sebastian Tcaciuc. Advisers to Advent were Ernst & Young (financial and duty-related issues), CMS Cameron McKenna (legal issues), Tax House (tax structuring issues), Dataroom Projects (due diligence and negotiation related issues), and WS Atkins (environmental issues). Salcianu Attorneys at Law provided legal advice to Bengoss.
Advent has been investing in Central and Eastern Europe since 1994 and is the only global private equity firm to do so from dedicated regional funds and with local offices across the region. In 2006/2007, the firm received several awards for its investment in Terapia, the Romanian generic pharmaceuticals manufacturer: Emerging Market Deal of the Year- Buyouts 2007; Large Exit of the Year- Unquote Central & Eastern Europe Private Equity Awards 2007; Emerging Europe Deal of the Year- EVCA/INSEAD/Real Deals Magazine 2006.