Cellular Italia, a European leader in making and distribution accessories for smartphone, tablet, mp3 readers with the brand Cellular Line, chose to list at the Italian Stock Exchange thanks to a business combination with the Special purpose acquisition company (Spac) Crescita (see here the press release).
This happens after a competitive auction has been open for more than one year, attracting many international private equity firms such as Alpha Private Equity, Pamplona, Carlyle, NB Renaissance and some strategic buyers (see here a previous post by BeBeez).
Crescita is a Spac promoted by well-known Italian finance professionals Massimo Armanini, Cristian D’Ippolito, Marco Drago, Carlo Moser, Antonio Tazartes and Alberto Toffoletto (through Crescita Holding srl) and by listed investment company Dea Capital spa. Crescita has bees listed at the Aim Italia market last March after having raised 130 million euros by investors  (see here a previous post by BeBeez). Among them Nextam Partners sgr owns today a 7.5% stake and Banca Imi (Intesa Sanpaolo group) a 6%.
Cellular Italia, through Ginetta spa, is today controlled by L Catterton private equity firm with minority stakes owned by Motion Equity Partners and DVR Capital and by the founding families Foglio and Aleotti.
L Capital and DVR Capital had bought control of Cellular Italia in July 2013 in a 180 million euros deal (see here a previous post by BeBeez), including 90 million euros of senior debt, from the Foglio and Aleotti families, which retained a minority stake in the company. Motion Equity Partners invested instead in Cellular Italia in 2014.
Last Friday Jan 19th the Board of Directors of Crescita spa, Cellular Italia spa and Ginetta spa signed an agreement for the business combination of the Crescita and Cellular, through the merger of Ginetta in Crescita, which will be renamed Cellularline spa and will remain listed on the Aim Italia market before listing on the Mta market. All that if Crescita’s shareholders won’t recede from the deal in a number equal or higher than 33% of Crescita’s ordinary shares. After the business combination, Cellular Italia will be owned by private equity funds with a 13% stake, by the founders with a 15% stake and by the managers with 9%.
Cellular group reached 164.5 million euros in revenues in 2016 with 38.4 millions in ebitda while net financial debt was 66.6 millions at the end of Sept. 2017 (see here an analysis by Leanus, after free registration and login). The group was valued about 300 million euros at the end of 2016 when the auction started or about 7.5x estimated 2016 ebitda which was seen at about 40 million euros.
The Documento informativo explains that Crescita will invest 80 million euros for buying a 49.87% stake in Ginetta spa and the remaining 50 million euros for financing Cellular Group growth.
Cellular group is actually valued 244.4 million euros or 6.3x adjusted 2016 ebitda, including a normalized net financial debt of 84 millions. So Cellular Group equity value is calculated as  160.4 million euros and floating capital will be 63% in the case of no recess by Crescita’s shareholders.
The deal includes also an earn out which will be eventually paid by Cellular italia shareholders to Crescita in the form of remedy shares.
Crescita is supported by Deloitte, Ernst & Young, Bain & Company and Nctm law firm. Cellular Group is advised by Rothschild, Ethica Corporate Finance, Electa Group and Studio Legale LMS. Banca Imi acts as Nomad and Specialist for Crescita.
