UK private equity firm 3i has sold its 48 percent stake in Swedish manufacturing company DIAB to Stockholm-based Ratos Private Equity for approximately SEK 400 million (€37.5 million; $47.6 million).
The transaction, if approved by the Swedish anti-trust authorities, will make Swedish investment firm Ratos a 96 percent stakeholder in DIAB, as it currently holds a 48 percent investment in the company.
DIAB manufactures and develops blades for wind turbines, boat hulls and decks as well as components for aircraft, trains, buses and space rockets. It uses low weight and high strength materials. It generated SEK1.35 billion in revenues in 2007.
In November 2007 3i and Ratos jointly refinanced DIAB for SEK1 billion, with debt from local bank Svenska Handelsbanken, achieving returns of approximately SEK500 million each.
3i director Christer Nilsson, said in a statement, that the firm is pleased with its return on this investment and that it believes DIAB will gain further success under the guidance of Ratos.
Ratos and 3i acquired DIAB when they bought Swedish private equity firm Atle in May 2001 in a £580 million deal. The deal saw 3i acquire 85 directly held investments and a 50 percent interest in a further portfolio of 19 investments held jointly with Ratos. Last August Ratos acquired further stakes in portfolio companies Arcorus, Gadelius and Haendig worth a total SEK250m from co-investor 3i.
Last week 3i revealed unrealised valuation losses on its top 50 portfolio companies of 21 percent, and reshuffled its senior management, with Michael Queen taking over from Philp Yea as chief executive.
Ratos approached 3i to broker the transaction, according to a 3i spokesperson.