Crown Holdings Bets on Spain, Buys Canning Firm Mivisa

CROWN HOLDINGS BUYS MIVISA TO GROW IN SPAIN

Crown Holdings Bets on Spain, Buys Canning Firm Mivisa

Philadelphia-based Crown Holdings is backing Spain’s manufacturing industry with its purchase of canning firm Mivisa. One of the world’s top packaging groups, Crown is banking on Mivisa to help grow its canned food business in Europe, focusing on Spain with its strong agricultural industry.

Mivisa, which operates 10 plants with six in Spain and one each in Morocco, Hungary, Peru and the Netherlands, is the largest canner on the Iberian Peninsula, with sales of more than 555 million euros.

Crown has agreed to buy Mivisa from Blackstone and Spanish buyouts firm N+1 Mercapital for 1.2 billion euros. The deal is expected to close next year, subject to regulatory approval.

Blackstone’s decision to sell Mivisa is an example of the top US private equity firm’s strategy of purchasing a business, turning it around and selling it on. Mivisa is one of its success stories.

FAMILY BUSINESS GOES GLOBAL

Mivisa started life in 1972 as a family-run business in Murcia in southeast Spain. When venture capital funds took over the helm some 30 years later, the company began to build up its business overseas.

Blackstone and N+1 Mercapital, formerly Dinamia, bought Mivisa for about 850 million euros from Blackstone’s European rival CVC at the end of 2010. Since then, Blackstone has invested over 35 million euros in the business and grown sales by over 11 per cent and jobs by 5 per cent.

Mivisa’s products are now sold in over 70 countries throughout the world, including South America and Eastern Europe.

FOREIGN INVESTORS BET ON SPAIN

The sale of Mivisa to Crown is the biggest venture capital deal in Spain so far this year, and there are expectations of more to come. An estimated war chest of nearly 13 billion euros has been earmarked by the venture capital industry for 2013. Private equity firms have been sniffing around for the last 18 months, waiting for Spain’s banks to offload distressed property assets at bargain basement prices.

Blackstone has been one of the busiest players in Spain, picking up property and land assets. Other foreign investors have also been eyeing mid-sized firms that have good business prospects but are strapped for cash because of the financial crisis.

Exporters in the machinery and manufacturing industries are attractive targets, given the upbeat outlook for Spain’s export sector, so Crown’s acquisition of Mivisa could well start a trend. On the heels of Microsoft co-founder Bill Gates purchase of a 6 per cent stake in Spanish builder FCC, this deal is also another vote of confidence for Spain’s economy, which finally exited its two-year recession last month.

For more information on investment in Spain, contact corporate law firm Argali Abogados.

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