Navis exits Hong Kong's Texon to global strategic
Navis Capital Partners has exited its entire controlling position in Hong Kong footwear components supplier Texon to UK-listed Coats Group for an enterprise value of USD 237m.
Coats, which is recognised as the global leader in industrial thread manufacturing, confirmed the pricing in a filing. Navis acquired Texon from Barclays Ventures in 2016 at a valuation in the USD 75m to USD 125m range. The firm participated through its USD 1.5bn seventh fund.
Texon was founded in 1947 in the US, later moving its headquarters to the UK after being acquired by British United Shoe Machinery (BUSM) in 1990. It produces woven and non-woven footwear components and develops new materials technologies. Clients have historically included leading footwear brands such as Nike, Clarks, and Adidas.
Barclays Ventures, a PE arm of Barclays Bank, invested in 2010. Its parent had earlier placed Texon under corporate recovery following the collapse of BUSM in 2000 due to unfunded pension liabilities. Apax Partners owned BUSM at the time, having acquired the business in 1995.
Under Barclays, the company saw its annual profit surge from GBP 1.5m (USD 1.8m) to GPB 100m over the course of 20 months. During this period, Texon moved headquarters to Hong Kong and consolidated its Chinese and Southeast Asian presence. There are currently factories in China, Vietnam, the UK, Germany, and Italy, as well as local presence in some 90 countries.
In 2021, Texon generated USD 132m in revenue, USD 21m in EBITDA, and USD 17m in adjusted operating profit. Revenue for the 12 months to June is expected to be USD 145m. In 2017, revenue and EBITDA reached USD 109.9m and USD 16.9m.
Navis helped review the company’s strategic growth plan, supporting investments into sustainability and innovation, while revamping client accounts management and management succession planning. The private equity firm also made a strategic bolt-on in Italy, which facilitated an expansion into technical fabrics.
The holding period was also characterised by the enhancement of an existing focus on environmental products and practices. In 2020, Texon said it wanted to be zero-waste by 2025. “We believe the last six years with Navis has created a strong platform to continue driving sustainability and innovation,” CEO Jelle Tolsma said in a statement.
Navis has significant experience in shoes. It entered the industry in 2005 with the purchase of Trimco, a label maker for Nike and Adidas, and exited seven years later with a 10x return. Before that, it secured a more than 4x multiple on industrial boot company King's Safetywear. Current exposure includes shoe leather supplier ISA Industrial, acquired in 2016.
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