Private equity firm HgCapital has completed its fifth investment in the Benelux region with the purchase of a distributor of industrial fasteners.

Private equity firm HgCapital has completed its fifth investment in the Benelux region with the purchase of a distributor of industrial fasteners.

The firm acquired FABORY, which supplies products such as bolts, nuts, screws, pins and nails, after securing the support of debt provider Bank of Scotland.

FABORY, which is based in the Netherlands, was sold by AAC Capital Partners (formerly ABN AMRO Capital) for €345 million (£240.7 million).

Post-completion, HgCapital will assist FABORY’s management to expand the business into Central and Eastern Europe.

FABORY’s chief executive, Alfons van der Aa, said: “We are looking forward to taking the company to the next level with the full support of HgCapital.”

This deal follows HgCapital’s acquisition of Mondo Minerals and is the sixth acquisition it has completed since the end of June this year.

HgCapital’s Alex Shivananda, managing director of its Benelux operations, said the firm has been monitoring FABORY’s progress for several years. “Alfons and his team have performed well and made the business more professional and repositioned it and we couldn’t fail to be impressed.

“Accordingly we are willing to pay a good price for a great business,” he added. “With our pan-European coverage and local presence, we are well-positioned to support FABORY’s exciting plans for geographical expansion.”

HgCapital’s financial adviser was NIBC, led by Hans Huiskes and Jouke Heringa with Herman Vocking.

Huiskes said HgCapital spent a lot of time understanding FABORY’s management’s growth plans.

“In any deal, it is vital to know management’s intentions for the future of the company and to analyse this information with industry experts,” he added. “The deal team’s understanding of FABORY’s business convinced the management team that HgCapital was the right party to take it to the next stages of growth.

“HgCapital showed a strong determination to get the deal done. It proves that successful private equity transactions are built on a thorough understanding of the industry being invested in.”

HgCapital received an operational due diligence report on the target business from consultancy Argo, Inc.

The review was led by chief operating Fernando Assens and logistics practice leader Mikael Åberg, with China specialist Nancy Kay.

The team examined FABORY’s supply chain processes and evaluated the potential to improve its EBITDA and cash flow.

Assens said this is the third due diligence assignment Argo has worked on for HgCapital.

“FABORY has some of the best logistics and warehouse practices we have seen, but it still has organic growth potential,” he added. “We are looking forward to helping HgCapital take FABORY to the next phase of its grow.”

FABORY, formally trading as Borstlap, was established in 1947 and is headquartered in Tilburg. It distributes chemical fasteners, such as tape, adhesives, sealants and power tools.

The company has more than 120,000 customers served by its operations in 14 countries, including France, Germany, North America and China.