Novem: The Final Solution

DC Advisory Partners proudly reports from Frankfurt/Main that it acted as sole financial adviser to DZ Bank and ING Bank (together, the Structuring Banks) on the sale of Novem Beteiligungs GmbH out of trusteeship to funds managed by Bregal Capital LLP. The Structuring Banks led the discussions on behalf of the senior lender syndicate.

Headquartered in Vorbach, Germany, Novem is described as a global manufacturer of high-quality decorative trim for vehicle interiors. It is the world leader for decorative wood interior components and employs around 3,900 staff across eight production sites in Europe, NAFTA and China.

Novem was acquired by Barclays Private Equity in 2008. In June 2009, following a significant downturn in the automotive sector, the shares in Novem were transferred to a trustee as part of a financial restructuring.

At the end of 2010, the trustee for Novem initiated a sales process following the strong operating performance of Novem and a broader recovery in the automotive market. A number of parties expressed interest in acquiring Novem; however, following lengthy negotiations between the stakeholders, it was Bregal that emerged as the successful bidder.

DC Advisory Partners say there were appointed by the Structuring Banks to provide M&A/Restructuring advice and to develop a final solution that would be acceptable to the senior lenders. In August, 2011, the proposed transaction received unanimous senior lender consent.

The transaction was structured as an equity purchase by Bregal, including a partial rollover of debt by the senior lenders and an instrument to share future outperformance between Bregal and the senior lenders rolling over their debt into the new deleveraged capital structure.

Commenting on the transaction, Norbert Schmitz, DC Advisory Partners, said: “We are delighted that this process has ended with the successful sale of Novem to Bregal, backed by the unanimous consent of the senior lenders. The new ownership structure will afford Novem further opportunity to strengthen and grow its position in the global high-end interior trim market.”