CD&R Creating Label Making Giant with Buys from Advent and Platinum
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CD&R Creating Label Making Giant with Buys from Advent and Platinum

At closing, the merged businesses will create the world’s largest label company with annual revenues exceeding $3 billion

SOURCE: iStock

Clayton, Dubilier & Rice (CD&R) is assembling a label-making giant with the buys of Fort Dearborn Company from Advent International and Multi-Color Corporation from Platinum Equity.

Fort Dearborn is a supplier of labels for the beverage, food, household products, paint and coatings, personal care, wine, and spirits markets. The company provides cut and stack, pressure-sensitive, roll-fed, and shrink-sleeve labels across multiple print technologies including digital, flexographic, offset lithographic, and rotogravure.

Fort Dearborn, led by CEO Kevin Kwilinski, is headquartered in the Chicago suburb of Elk Grove and operates out of 20 locations across the United States (18) and Canada (2). Advent International acquired Fort Dearborn from KRG Capital Partners in August 2016.

“We believe the growth opportunities that this combination and new investment partnership with CD&R present will greatly benefit our customers, suppliers, and employees alike,” said Mr. Kwilinski. “We believe MCC’s global footprint and CD&R’s experience helping industrial companies enhance operational execution and achieve global scale and growth will benefit the combined enterprise.”

Multi-Color manufacturers various types of labels for the beverage, wine and spirits, food and dairy, personal care, home care and laundry, healthcare, automotive, and chemicals industries. The company operates 80 label production facilities across 27 countries and employs over 9,000 people. Multi-Color, led by CEO Nigel Vinecombe, is headquartered east of Cincinnati in Batavia, Ohio.

Platinum Equity took publicly-traded Multi-Color private in July 2019 at an enterprise value of $2.5 billion. At the time of this transaction, Multicolor had annual revenues of $1.7 billion and EBITDA of $272 million, resulting in an EBITDA valuation multiple of 9.2x.

“At Multi-Color, we have continually worked to invest in our people, processes and technology in order to strengthen our organization and become one of the most trusted and innovative label manufacturing leaders across the globe,” said Mr. Vinecombe. “Platinum’s financial and operational support have been instrumental to our success. This combination with Fort Dearborn and the ongoing support of value-added investors provide the opportunity to continue to strengthen the business and provide best-in-class service to our customers.”

At the closing of this transaction, David Scheible, an operating advisor to CD&R and current member of Fort Dearborn’s board of directors, will lead the combined company as its chairman.

“We see strong strategic logic and promising value creation potential in bringing these two leading label manufacturers together,” said Nate Sleeper, CEO of CD&R. “We look forward to working with the combined company’s leadership team to help drive innovation and enhance its offering to a highly discerning customer base around the world. We see numerous opportunities to drive operational scale, achieve sustained growth, and we believe our expertise can help position the combined company for success well into the future.”

New York and London-based CD&R invests in European and United States-based businesses. Since its founding in 1978, the firm has invested more than $35 billion in over 100 companies across a range of industries including consumer, retail, healthcare, industrial, technology and business services.

Advent International invests in companies active in business and financial services; healthcare; industrial; retail, consumer, and leisure; and technology, media and telecom. The firm has 14 offices in 11 countries and employs 240 investment professionals across North America, Europe, Latin America, and Asia. Founded in 1984 and headquartered in Boston, Advent has $74 billion in assets under management and has completed more than 375 private equity transactions.

Platinum Equity invests in a range of industries including manufacturing, distribution, transportation and logistics, equipment rental, metals services, media and entertainment, technology, and telecommunications. The firm is currently investing from Platinum Equity Capital Partners V LP, a $10 billion buyout fund, and Platinum Equity Small Cap Fund LP, a $1.5 billion buyout fund focused on the lower middle market. Platinum was formed in 1995 by Tom Gores and is headquartered in Beverly Hills.

© 2021 Private Equity Professional | July 16, 2021

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