Mandarin plans China expansion for Italian footwear textiles maker
Mandarin Capital Partners and Private Equity Partners have acquired control of Milan-based Industrie Chimiche Forestali SpA (ICF), which develops adhesives and special textiles for the footwear industry.
The investors plan to expand the business beyond European markets, particularly in China. Mandarin Capital paid EUR18 million ($24.5 million) for an approximately 92% stake in ICF. The remaining shares are held by Private Equity Partners, the CEO of ICF and two individuals.
This is the first investment made from the Sino-European PE firm's newly-launched fund. Mandarin Capital II, which is still in the fundraising stage, is targeting a second close of EUR200 million ($272 million) between July and August. The fund has a target of EUR400 million.
The second fund has shifted its China strategy and it will no longer to invest in Chinese companies seeking to expand overseas, according to Alberto Forchielli, managing partner at Mandarin Capital.
The GP previously sought to help Chinese companies expand overseas, as well as supporting international firms, in particular from Europe, to establish their foothold in China. Notable previous investments include Chinese construction equipment maker Zoomlion in 2008. Mandarin Capital, Hony Capital and Goldman Sachs supported the acquisition of Italy's Compagnia Italiana Forme Acciaio (CIFA) and exited their stakes to the parent company in 2012.
The private equity firm will also stop raising capital from Chinese investors for its new fund.
"We are going slower in fundraising, because we switched fundraising from China to US," Forchielli told AVCJ. "Fundraising in China has become more difficult. We don't want large state-owned enterprises (SOE) as LP. They make lots of intrusions into management independence."
Mandarin has completed 10 investments in Chinese and Italian companies from in its EUR328 million debut fund, raised in 2007. China Development Bank, the Export-Import Bank of China and Italy's Sanpaolo IMI are among the investors.
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