EI sells DGS to Guala Closures
Warsaw, 7 April 2011 — Polish Enterprise Fund V (PEF V), a private equity fund managed by Enterprise Investors (EI), has exited its investment in the Polish aluminum closures manufacturer DGS SA. PEF V has sold its 80% stake in DGS to Guala Closures Group in a transaction that puts the enterprise value of DGS at €80 million. The deal requires the approval of the Polish Office for Competition and Consumer Protection.
Guala Closures Group is a private equity backed leader in the production of non-refillable closures for spirits, and one of the main producers of aluminum closures in Europe, Latin America and Asia, also active in the PET and the pharmaceutical packaging markets.
“This acquisition is a further step in our strategy to develop our core business, and confirms the confidence we have in the Central European market. We are sure that with the help of the founder, Mr. Krzysztof Grządziel, and of all the management, we will be able to deliver to the market the best service and the best available product portfolio,” said Paolo.
Paolo Ferrari, M&A Director of Guala Closures Group.
Located in Włocławek, Poland, DGS is a manufacturer of aluminum closures for the spirits and wine industry. The company was established in 1991 by a group of private entrepreneurs led by Mr. Krzysztof Grządziel, currently a 20% shareholder and the company’s chairman. Polish Enterprise Fund V managed by Enterprise Investors acquired an 80% stake in DGS in 2005. Since then the company has developed from a domestic player into a truly international company exporting to Europe, North America and Africa. DGS’s business in steel closures for preserved food (so-called twist off closures) was sold to Silgan International in February 2011. In 2010 DGS achieved revenues of €60 million.
“DGS has evolved from being a local player with a strong position on the Polish market into a major European player supplying market leaders in the alcoholic beverages industry in Poland, Europe and North America. Credit for these achievements goes first of all to the company’s management team led by Mr. Marek Kłopocki and to DGS’s founder and chairman, Mr. Krzysztof Grządziel. We believe that Enterprise Investors also contributed, e.g. by helping DGS build a sales organization capable of tackling international markets immediately after we made our investment,” commented Michał.
Michał Rusiecki, managing partner at Enterprise Investors, who is responsible for this investment.
“Our fund invested in DGS in a leveraged transaction six years ago. The company has successfully paid back the debt incurred at that time, while investing in a major expansion of capacity and product range,” said Agnieszka.
Agnieszka Kowalska, partner at Enterprise Investors, who co-led the investment in DGS.
Enterprise Investors was advised on this transaction by Poland Corporate Finance, Gide Loyrette Nouel, Ernst & Young and Accreo.