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CapMan sells majority in Moventas to Industri Kapital

29 January 2007 -- The funds managed by CapMan and Industri Kapital 2004 fund have signed an agreement according to which CapMan funds will sell the majority of their shareholding in Moventas Oy to Industri Kapital. CapMan Plc is a substantial investor in the CapMan Equity VII fund that will partially exit from Moventas and the impact of the transaction on CapMan’s result for 2007 is EUR 1.5 million as a result of fair value gains of the fund investment. Fair value gains totalling EUR 1.0 million from the increase in Moventas’ value were entered also in CapMan’s result for the last quarter of 2006.

Moventas Oy is a leading manufacturer of industrial and wind turbine gears as well as provider of gear maintenance and service. The announced transaction is subject to approval from competition authorities and it is expected to be closed in the first quarter of 2007. Industri Kapital 2004 fund will make the transaction on behalf of a new company, and following the transaction it will own 58% of Moventas, Varma will own 4%, the management 22% and CapMan funds 16%. CapMan’s representative will continue in Moventas’ Board of Directors after the closure of the transaction.

In connection with the transaction CapMan Mezzanine IV and Finnmezzanine III funds will exit from Moventas in total. CapMan funds invested in Moventas in April 2005, when they acquired the then Metso Drives from Metso Corporation. The funds’ ownership in Moventas was 77% prior to the transaction, Varma’s ownership was approx. 17% and the management’s share was approx. 6%. The investment has been very good for the investors in funds managed by CapMan, as the realisation has an approx. fourfold return on investment to investors.

”The strong technical knowledge and good customer relationships built during Metso’s ownership have created solid ground for Moventas’ rapid growth and improved profitability. During CapMan’s ownership the increase in sales has been very fast especially in wind turbine gears. The company has made significant investments, and the current capital expenditure program aims at doubling the volumes. The announced transaction is a natural step in the development of Moventas,” comments Orvo Siimestö, Senior Advisor at CapMan.

“We are delighted to be acquiring Moventas, which benefits from a leading position as an independent major wind gear manufacturer with a strong position in selected industrial market segments. We are looking forward to working with the management team and CapMan, to bring the company to its next stage of development. We will continue organic expansion by leveraging Moventas’ unique position, focusing on supporting the company in enhancing operational excellence and in particular on improving customer services. We will also pursue acquisition led growth,” says Michael Rosenlew, Partner at Industri Kapital.

”We clearly see this change as further enhancing our capabilities in capturing the future market potential in both business areas, Wind Gears and Industrial Gears. Along with our expertise and ongoing significant investments, the new ownership base will provide us with additional strength for pursuing growth in the future,” states Ilkka Hakala, President and CEO of Moventas.

Press Conference:
We would like to invite the media and analysts to a Finnish press conference today, 29 January 2007 at 11.00 a.m. in CapMan’s headquarters, address Korkeavuorenkatu 32, Helsinki. CEO Heikki Westerlund and Senior Advisor Orvo Siimestö from CapMan, Partner Michael Rosenlew from Industri Kapital and President and CEO Ilkka Hakala from Moventas will be present at the event. The presentation will be shown on CapMan’s Internet pages when the press conference has commenced.

For further information, please contact:
Orvo Siimestö, Senior Advisor, CapMan Buyout, tel. +358 40 562 0317
Heikki Westerlund, CEO, CapMan Plc, tel. +358 9 6155 8304 or +358 50 559 6580
Michael Rosenlew, Partner, Industri Kapital, tel. +46 8 678<

Publisher Contact Information:

CapMan Capital Management Oy
+358 40 562 0317

Company profile of CapMan Capital Management Oy
Past press releases of CapMan Capital Management Oy.


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