(Finance) – doValuethe main provider of strategic financial services in Southern Europe, following the fulfillment of all conditions precedent, including the required regulatory approvals, today completed the acquisition of 100% of the share capital of Gardant.
Manuela Franchi, CEO of doValue: “This operation represents an important step for our Group: doValue is already a leader in credit management in Europe, with a consolidated presence in key countries of the Old Continent. With the integration of Gardant we further strengthen our leadership and aim to create a true center of excellence on the Italian and international markets, with the ability to offer banks and investors one of the widest range of products and services along the entire credit management chain”.
Mirko Briozzo, CEO of Gardant: “For us at Gardant, the integration with doValue represents the best opportunity to ensure that everything we have successfully built and developed over a decade, first with Credito Fondiario, since 2013, and then with Gardant, becomes an integral part of offering customers from an expanded and listed pan-European leader and we are proud of it. I am excited about the opportunity to begin this new challenge of growth and development.”
Gardant, born in 2021 from the reorganization of Credito Fondiario, is a leader in Italy in credit management and financial services. Over the last 5 years, Gardant has recorded significant growth thanks to strategic partnerships, such as the joint ventures with Banco BPM and BPER Banca, leveraging advanced data-driven tools for portfolio optimization. For fiscal 2024, Gardant expects €135 million in revenue and €50 million in EBITDA, with 40% of revenue coming from non-NPL services such as UTP, asset management and master servicing.
Following today’s announcement, a note explains, Italy becomes the Group’s main market. Clients of the new Group will benefit from a world-class offering and technology, while Gardant’s expertise in UTPs and credit-focused asset management will be further enhanced through the Group’s increased scale.
doValue will accelerate the execution of the new 2024-2026 Business Plan anticipating the objectives of revenue diversification and debt reduction. In particular, Gardant’s UTP platform and capabilities will equip the Group with the scale and know-how to compete in one of the most profitable and promising segments of the Italian NPE market.
The Target Group integration plan, developed within a joint steering committee, will be launched immediately. The combined integration plan allows the Company to rapidly pursue and realize the expected synergies of €15 million at full capacity. doValue’s confidence in a successful integration is strengthened not only by doValue and Gardant’s proven experience in integrating newly acquired businesses, but also by the strong cultural alignment between the two organizations, which will foster ongoing collaboration and operational efficiency .
Financing and Value of the operation
The total consideration for the Acquisition of Gardant Group consists of €230 million including a cash consideration of approximately €181 million and €50.4 million recognition of net financial debt; and from the issue of new shares corresponding to a 20% stake in the new Group, deriving from the conversion of a convertible bond already subscribed by the sellers. The convertible bond will convert into 4 million doValue shares by the third trading day from today. Taking into account Gardant’s net financial position as of 31 December 2023, together with certain routine adjustments, the cash consideration for the transaction reflects an Enterprise Value of €230 million.
The transaction was financed by drawing on a €240 million acquisition term credit facility from a new bank financing package of €526 million (including 5-year amortization term loans and a 3-year Revolving Facility years of €80 million) provided by an international pool of 14 banks. doValue will also draw on a refinancing term credit facility (up to €206 million) to finance the early repayment of the 2025 bonds, following completion of the capital increase.
The financing operation is supported by ordinary guarantees in line with market practice.
Governance
Following the conversion of the convertible bond, Tiber will hold 17.75% of the share capital of doValue, while the remaining sellers of Gardant will hold 2.25%. The converted shares will be subject to a lock-up period of between 6-12 months (Tiber 12 months). As approved by the Shareholders’ Meeting on September 11, 2024, with the Closing two members designated by Elliott will join the doValue Board of Directors.
Optional capital increase
The company recalls that, as announced on 20 November 2024, following the approval of the prospectus, the offer period relating to a divisible capital increase for a maximum amount of approximately €150 million will begin on Monday 25 November.
The anchor shareholders Fortress, Bain, Tiber and some managers of Gardant have made an irrevocable commitment to subscribe to the capital increase for a total amount of approximately €82.5 million. The remaining part of the capital increase (equal to approximately €67.5 million) is guaranteed by a guarantee contract signed on 21 November 2024 (the “Underwriting Contract”) supported by a pool of banks of primary standing are committed, separately from each other and without any obligation of solidarity, according to the terms and conditions set out therein, to subscribe, in proportion to the respective commitments undertaken pursuant to the Underwriting Contract, any new shares that may have remained unopted at term of the offer on the stock exchange up to the overall amount equal to the difference between the overall value of the capital increase and the portion covered by the aforementioned subscription commitments.