Aimia has announced that it has signed a definitive agreement to acquire substantially all of the issued and outstanding shares of Giovanni Bozzetto from Chequers Capital and other minority shareholders.

The purchase price will be based on an enterprise value of approximately $328 million. It is anticipated that the acquisition will be financed with a combination of cash and debt, with an expected level of debt of around 3x Adjusted EBITDA, or approximately $135 million.

Bozzetto achieved annual revenue of approximately $326 million and Adjusted EBITDA of $47 million with an Adjusted EBITDA margin of 14.5% for the fiscal year ended December 31, 2022, with higher than 80% free-cash flow conversion. Transaction closing, which is subject to regulatory approval and other customary closing conditions, is expected to occur before the end of the second quarter of 2023. The executive management team of Bozzetto will reinvest a material portion of their net proceeds from the sale representing a minority position of up to 6%.

Phil Mittleman, CEO of Aimia, said: "With an over 100-year history of operations, high margins coupled with strong cash flow conversion, and an excellent management team, Bozzetto represents an outstanding opportunity for Aimia to invest in an ESG-focused, global market leader. Over the past 18 months, the specialty chemicals industry has endured one of the most difficult periods in its history—including a spike in raw material prices, Covid-induced supply chain shortages and rapidly rising energy prices. Despite these challenges, Bozzetto remained resilient and maintained its strong growth and free cash flow profile. We see significant opportunities to continue to grow this business both organically and through accretive acquisitions, and we are in advanced discussions with several potential targets."

Mittleman added, "Once both Bozzetto and our previously announced acquisition of Tufropes close, these two subsidiaries will have generated approximately $72 million in Adjusted EBITDA for their most recent fiscal years, with high free cash flow conversion, providing Aimia with a very strong foundation on which we will continue to build."

Roberto Curreri, CEO of Bozzetto, said: "This is a great moment for the Bozzetto Group.  Our company has built upon its long-term heritage and over the last decade has been able to combine that with a renewed value proposition, which has been the main factor enabling us to face a number of challenges with confidence, and success.  With the support of Chequers, the Group has diversified its product lines and geographical presence in its core markets through strategic acquisitions.  Aimia is presented with a unique opportunity to continue down this path and grow further, with a particular focus on America.  I am very excited about this new partnership and am fully committed to leading the company to even greater heights."

Philippe Guérin, Managing Partner of Chequers Capital declared: "Bozzetto is a perfect illustration of these highly performing Italian companies with strong industrial know-how, sustained innovation, commercial dynamism and run by high quality managers. With the support of Chequers, the Bozzetto team has been able to shift the portfolio of activities of the group towards fully ESG-compliant products, enhance its operations and make acquisitions to double the sales of the group within 5 years and almost triple its profits. It was a pleasure to back Bozzetto during these 5 years of uninterrupted growth and continued operational improvement and we wish all success to Aimia and the Bozzetto management team in this new phase of development."

Paladin's Founder and Managing Partner, Tariq Osman, added: "We are thrilled to partner with Aimia to support Bozzetto's outstanding management team for the Company's next chapter of growth. Paladin is particularly excited to support a growth strategy to expand into the Americas as we believe this aligns well with the reshoring trend in the textile industry. Together with Aimia, Paladin intends to extend Bozzetto's already excellent ESG credentials by supporting a program of operational initiatives aimed at reducing greenhouse gas emissions, improving productivity, reducing costs and generating new carbon offset revenue streams."

Founded in 1919 and headquartered in Filago, Italy, Bozzetto is a leading ESG-focused provider of specialty chemicals, manufacturing over 2,000 proprietary chemicals to service its core textile, water solutions, and dispersion end markets.

With a product portfolio comprised of over 75% ESG-focused chemicals, Bozzetto has built a strong reputation as a pioneer of developing ESG-focused solutions that align with secular purchasing criteria trends and key customers' stated sustainability initiatives, including the benefits of a circular economy, and reduction in water, energy, and hazardous chemicals.

Bozzetto currently operates with a global industrial footprint of 6 manufacturing facilities, servicing over 1,500 customers in more than 90 countries. Sales are generated across EMEA (49%), South-East Asia (24%), Turkey (15%), the Americas (8%) and China (4%). Under Aimia's ownership, the Company will seek to substantially expand into the Americas and Asia organically and through accretive acquisitions, further diversifying Bozzetto's historically European presence.

Paladin Private Equity will act as Aimia's partner on the transaction. Aimia and Paladin were advised by Latham & Watkins. Chequers was advised by ADVANT Nctm and Lazard and Fineurop Soditic, while the Bozzetto management team was advised by GOP.