Avallon appoints a specialist investment fund
The Avallon company , founded the first Polish private equity firm specialising in management buyouts – Avallon MBO FUND. The fund is managed by a team of Polish experts, who, since 2001 has advised on more than 70 MBO / LBO transactions. Avallon MBO Fund has a capital of EUR 50 million, and its investors include The European Bank for Reconstruction and Development, the Swiss investment bank LODH and many other international financial institutions.
The establishment of the fund was festive; guests of the press conference were representatives of EBOR: Kazimierz Marcinkiewicz – the CEO of EBOR for Poland, Bulgaria and Albania; Dragica Pilipovic-Chaffey – the CEO for Poland and the Baltic countries, as well as Patrick Borzęcki – Principal Banker.
During the conference, President of Avallon – Tomasz Stamirowski stressed that management buyouts are a popular form of acquiring companies in the world, but in Poland there is not enough funding to enable such transactions, especially in the segment of small and medium-sized businesses.
Celem funduszu będzie inwestowanie w małe i średnie przedsiębiorstwa w ramach struktur wykupu menedżerskiego i lewarowanego. Podmiot ten będzie dokonywał inwestycji przede wszystkim w Polsce. Dopuszczalna będzie także możliwość zainwestowania do 25% kapitału w innych, nowych krajach członkowskich Unii Europejskiej.
The fund will invest in small and medium-sized enterprises within the framework of management and leveraged buyouts. This entity will make investments primarily in Poland. It will also be an opportunity to invest up to 25% of the capital in other new member states of the European Union.
The Fund will seek to buy controlling stakes, investing together with the management teams. The expected average size of investment is estimated at about EUR 5 millions of equity. Most transactions will be leveraged.
The Fund will support the development of private enterprises in Poland and in the region of Central and Eastern Europe through strategic and operational restructuring , and by extending the use of structures and leveraged and management buyouts in the sector of small and medium-sized enterprises.
The impact of the project on the development and restructuring of the market will be most evident in the following three areas of activity:
- Demonstrating that the equity funds investments are a constant and stable source and form of financing of small and medium-sized enterprises.
- Promoting the use of MBO structures and strategies in small and medium-sized enterprises.
- Restructuring of the companies in the investment portfolio, leading to increase of their profitability.
The first transaction, which was conducted by the new fund was the acquisition of 40 percent of shares of the company from Lodz, Medort, and its convertible bonds. Medort specialises in orthopaedic and rehabilitation equipment.