JSE-listed Bidvest has acquired industrial and consumer products supplier Brandcorp from Ethos Private Equity for an undisclosed amount.
In a statement released on Friday, Bidvest said the acquisition presented an attractive investment opportunity that was aligned with Bidvest’s strategy of expanding its business operations through value-accretive acquisitions.
The acquisition would enable Bidvest to add niche industrial and consumer products, including the Cellini brand, into its portfolio.
Brandcorp would be included in the Bidvest Commercial Products (BCP) division, which already comprises various industrial and consumer businesses such as G.Fox, Plumblink, Home of Living Brands, Berzacks, Yamaha and Academy Brushware.
“The acquisition of Brandcorp allows us to add scale to BCP, as well as [providing] access to an existing client base that can be leveraged for synergies and other possible opportunities across the Bidvest group.
“Brandcorp brings strong, well-known and niche brand offerings into Bidvest, which are difficult to replicate in this market. There is a natural fit between our two companies as we have similar decentralised management operating models and in instances our product offerings and customer base is complementary,” commented Bidvest CEO Lindsay Ralphs.
Ethos Fund V acquired Brandcorp in 2007 with the intention of strategically repositioning the company.
Brandcorp has since made strategic acquisitions, including that of Renttech and Burncrete; introduced a black economic-empowerment shareholding; expanded its warehouse capacity; enhanced its management; and undertaken a comprehensive strategic review of the business.
Ethos also recapitalised Brandcorp through a R750-million high-yield bond placement in 2010.
"Such initiatives reaffirm Ethos' ability to identify attractive opportunities and work with management teams to create long-term value that is predominantly derived from earnings and revenue outperformance. Our ability to grow companies, even during challenging times, has made Ethos the partner of choice for successful management teams who have a desire to explore corporate change and growth," commented Ethos partner Shaun Zagnoev.