Apax Funds reach agreement to sell LR to a consortium
22 December 2012
Munich
Funds advised by Apax Partners ('Apax Funds') have reached an
agreement to sell LR Health & Beauty Systems ('LR') to a
consortium. The consortium consists of private equity firms Bregal
Capital and Quadriga Capital. LR is a strongly growing company,
which markets cosmetics, personal hygiene products, dietary
supplements, perfumes and jewellery through the direct sales
channel. The new shareholders will support LR Group in expanding
its national and international activities. The transaction is
subject to approval by the relevant anti-trust authorities. The
parties agreed not to disclose the sale price.
"LR Health & Beauty has a unique business model within the
direct sales market. From the beginning the management-team, headed
by Jens Abend, and the employees have demonstrated us through their
enthusiasm and dedication that LR is an exceptional company with
high growth potential especially in foreign markets. We want to
support the group and people working for it to realize that
potential", says Andreas Fendel, founding partner of Quadriga
Capital.
Florian Schick, Partner of Bregal Capital, comments: "LR is an
innovative company with a superior value proposition to its sales
partners and customers, and we are excited to support Jens Abend
and his team in the continued internationalisation of the
business."
Apax Funds bought into LR in November 2004, and then gradually
acquired a majority share. In partnership with Apax, LR's
management team revised the corporate strategy and professionalised
its internal processes. They also drove the internationalisation of
the business model forward and expanded the product range.LR now
generates 52 per cent of its sales outside of Germany,
predominantly in Western and Southern Europe. LR has been expanding
in Russia, Kazakhstan, Albania, Bulgaria and Romania. Through
collaborations with international stars like Bruce Willis, Heidi
Klum, Michael Schumacher and Boris Becker new star products have
been launched, especially in the perfume and cosmetics segment.
During the period of the Apax Funds' investment, LR's sales rose
from around €180m (2004) to approximately €230m (2011). Between
2004 and 2012 the number of sales partners increased from about
190,000 to about 300,000. The number of staff increased from circa
570 to around 1,000.
"The successful investment of Apax Funds in LR highlights the
expertise of Apax Partners to identify attractive business models
in our key industries and to develop them over the long-term.
Together with CEO Jens Abend and his team, we have driven the
professionalisation of LR, supported the company's sustainable
growth, and enabled it to continue its international expansion. We
are proud of having been a partner of LR and its management team
over the past eight years", says Ralf Gruss, Partner and COO at
Apax Partners.
"Since the investment of Apax Partners, LR has developed into a
leading direct sales company in Europe. As market leader in Germany
in its segment, LR has consistently and constantly grown in foreign
markets. Apax believed in the strength and business model of our
company right from the very beginning. The cooperation with Apax
was exemplary. Now a new chapter in the LR story is beginning",
says Jens Abend, CEO of LR.
Apax has deep retail and consumer business expertise and a
successful track record of investing in this sector. Over the past
ten years, funds advised by Apax have invested approximately €5.2bn
in retail and consumer businesses. Current and historic notable
investments in this sector include: Tommy Hilfiger, the global
lifestyle brand; Advantage Sales & Marketing, the leading
provider of outsourced sales and marketing services to consumer
packaged goods companies and retailers in North America; Tnuva, the
largest manufacturer and distributor of dietary and other food
products in Israel; and Takko, a fast growing value fashion
retailer in Europe.
Apax was advised by UBS and Société Générale.
About Apax Partners
Apax Partners is one of the world's leading private equity
investment groups. It operates globally and has more than 30 years
of investing experience. Funds under the advice of Apax Partners
total over US$35 billion around the world. These Funds provide
long-term equity financing to build and strengthen world-class
companies. Funds advised by Apax Partners invest in companies
across its global sectors of Tech & Telecom, Retail &
Consumer, Media, Healthcare and Financial & Business Services.
For further information about Apax, please visit: www.apax.com.
About LR Health & Beauty Systems
GmbH
LR Health & Beauty Systems GmbH, one of Germany's leading
direct sales enterprises for body care and beauty products, is
represented in 30 countries and with approx. 1,000 employees and
around 300,000 independent sales partners, LR is one of the leading
global players in the industry. Its pillars of success include
German quality products, a unique car plan, a professional training
and service program for sales partners, a fair and transparent
marketing plan as well as the cooperation with celebrities like
Bruce Willis, Heidi Klum, Michael Schumacher, Boris Becker and
Marcus Schenkenberg. LR is also a member of the following
associations: Verband der Vertriebsfirmen Kosmetischer Erzeugnisse
e.V. (VKE) [German cosmetics distributors and marketing
association], Bundesverband deutscher Industrie- und
Handelsunternehmen für Arzneimittel, Reformwaren,
Nahrungsergänzungsmittel und Körperpflegemittel e.V. (BDIH),
[Association of German industrial and trading firms for
pharmaceuticals, health care products, food supplements and
personal hygiene products], Bundesverband Direktvertrieb
Deutschland e.V. (BDD) [German Association of Direct Sales] and the
European Direct Selling Association (SELDIA). Further information
at. For further information about LR Health and Beauty Systems,
please visit: www.lrworld.com/en/.
About Quadriga Capital
Quadriga Capital is a leading investment firm in Germany and
neighbouring countries that specializes in acquiring and supporting
medium-sized companies that pursue long-term transformation and
growth strategies. Investors in Quadriga Capital funds are
international institutional investors, such as pension funds and
insurance companies. Quadriga Capital's portfolio companies include
among others AHT Austria Haustechnik GmbH in Austria, the Ameos
Group in Zurich, Kinetics in Eschau/Bavaria, the Lapp Group in
Stuttgart or the Ipsen Group in Kleve / North Rhine Westphalia.
About Bregal Capital
Bregal Capital is a private equity firm with fund commitments of
more than €3 billion and has since inception invested in over 20
companies. Bregal Capital is currently investing from The Bregal
Fund III L.P., a €1 billion fund, targeting middle market
investments in buy out and development capital.
Contacts:
Apax Partners
Ben Harding
Tel: +44 (0)20 7872 6401
Email: communications@apax.com
Apax - Germany enquiries
Reinhard Saller
Ira Wülfing Kommunikation GmbH
Tel: +49 (0)89 2000 3038
Email: reinhard.saller@wuelfing-kommunikation.de
Apax - US enquiries
Kekst and Company
Todd Fogarty
Tel: +1 212 521 4854
Email: todd-fogarty@kekst.com
Bregal Capital
Florian Schick
Tel: +44 (0)20 7591 4200
Email: florianschick@bregalcapital.com
Quadriga Capital
Dr. Andreas Fendel
Tel: +49 69 7950 0025
Email: a.fendel@quadriga-capital.de