Astorg Partners has signed an agreement with the French group FCI, one of the largest manufacturers of connectors and interconnect systems in the world, for the purchase of its Microconnections division. The transaction should be completed by the end of October 2011.
Microconnections is the world's leading manufacturer of flexible tape material for smart cards. These sophisticated flexible printed circuits are used in several applications, including SIM cards for mobile phones, banking cards and e-ID cards, etc. Other products are also being developed such as connectors for medical sensors and connectors for LED bulbs.
Microconnections had a sales turnover of 202 million euros in 2010. Alongside the booming smart card market, its sales turnover has grown by 18% on average every year for the last five years.Microconnections employs 670 people at two production sites, one is located in Mantes-la-Jolie,France (390 employees) and the other in Singapore (280 employees).
Within ten years, Microconnections has become the worldwide leader in its market thanks to its ability to invest in R&D. Consequently Microconnections has developed connectors adapted to its customers' new applications, while steadily widening its product range and reinforcing the reliability and productivity of its production processes.
The deal with Astorg will be financed with a buy-out debt of 320 million euros. As is the case in most of its portfolio companies, Astorg will again propose a broad employee shareholding scheme.
The selection of Astorg by FCI and its shareholder Bain Capital follows a competitive process designed to identify the best possible partner for the Microconnections division. With more than €2 billion of assets under management, Astorg is one of the most active private equity firms in Europe. Established in 1998, Astorg has developed solid industry expertise supporting French companies in their development abroad.
"As the global leader in the manufacture of flexible printed circuits for smart card applications, it was essential for us to find the right partner to accompany MIC's development plans", said Christophe Duverne, CEO of Microconnections. "Astorg has a strong track record in developing the companies it invests in, while respecting their culture and social vision. Astorg has demonstrated solid expertise in technology companies. With their support, this spin-off will provide Microconnections with the right set-up to deploy its ambitious growth strategy." Christian Couturier, Partner at Astorg adds "We decided to invest in Microconnections because the company has managed to become a global leader in its market, thanks to its outstanding innovation capabilities and industrial know-how. We are looking forward to working with Microconnections management team, led by Christophe Duverne; we are determined to offer them our full support to turn Microconnections, as a stand-alone company, into a worldwide success story for the benefit of its customers and teams."
"Being part of Astorg's portfolio will definitely open up increased opportunities for
Microconnections to expand into new markets", says Pierre Vareille, CEO, FCI Group. "Within the FCI context, Microconnections has been operating autonomously. As a stand-alone company, Microconnections will capitalize on its key assets and focus on further growth."
"We have supported the rapid growth of Microconnections over the past five years and invested heavily in the technological innovations it has brought to its customers. The Company is very well positioned to continue on this strong trajectory" says Walid Sarkis, Managing Director at Bain Capital.
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