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Automotive | Industrial Machinery & Components

Erne Group GmbH has been acquired by a private investment consortium

The private shareholders of Erne Group GmbH have sold the company to a private investment consortium. Financial details have not been disclosed.

Erne Group is an international group of companies headquartered in Austria, engaged in the production of high-quality pipe fittings and tubes with application in various industries. The group is divided in two divisions, Fittings and Automotive, which are accountable for 70% and 30% respectively of the total sales. The family-owned group was founded in 1920.

The buyer is a private investment consortium belonging to the Austrian investor Stephan Zöchling, who also owns REMUS and SEBRING, both engaged in the automotive industry and with a combined turnover of US$100 million. The investment consortium is taking an active management role in the acquired companies and is trying to achieve synergies within their existing portfolio.

Oaklins' team in Austria advised the shareholders of Erne Group GmbH in this transaction. The group was currently experiencing financial difficulties due to high gearing, wrong strategic decisions in the past by the former management, as well as a volatile market situation. Based on a very high level of net debt, the company was sold for only a symbolic price. Additionally, a substantial capital increase amounting up to US$22 million was agreed with the investor. These additional funds are intended to guarantee the further restructuring of the group and will build a stable framework for future improvements as well as a sustainable increase in the company's value. Oaklins’ team supported the shareholders to achieve the best possible result.

Prior to the transaction, the team advised the company on a restructuring process, especially in the negotiation with the debt financing partners, and the implementation of various optimization measures. The Austrian team prepared all transaction documentation and collected non-binding offers in the course of the international market approach via other international Oaklins teams. After preparing the data room, the Austrian team steered the process through the due diligence phase including an intensive Q&A process. Finally, the binding offers were negotiated with two bidders, which were top ranked by the client and the best-fit investor was selected, with comprehensive industry experience in the metal processing and automotive industry.

M&A sell-side

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 Thomas  Jungreithmeir

Thomas Jungreithmeir

Managing Partner
Vienna, Austria
Oaklins Austria

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