European Capital Completes Sale of its Portfolio Company Whitworths for 90 Million Pounds Sterling

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Sep 13, 2013, 06:45 ET

ST. PETER PORT, Guernsey, Sept. 13, 2013 /PRNewswire/ -- European Capital Limited and its affiliates ("European Capital") announced today they completed the sale of Whitworths (the "Company"), a company majority owned and operated by European Capital, to funds managed by Equistone Partners Europe Limited ("Equistone"), for £90 million. European Capital received £59 million from the sale and its compounded annual rate of return over the life of the investment was 2.4%. The proceeds received were lower than the second quarter 2013 valuation of European Capital's holding by less than 3%.

"We are very pleased with the outcome of this transaction", commented Ira Wagner, President of European Capital Financial Services ("ECFS"). "Our purchase of Whitworths was initially impacted by the economic downturn, and so we laboured hard with the management and employees of Whitworths to de-risk the Company's business model and return it to good health, which we are pleased to have accomplished over the past several years. This is an illustration of European Capital's focus on growing companies operating in industries with favourable long term fundamentals and our committed approach to supporting our companies through thick or thin. We continue to seek attractive buy-out opportunities in Europe with enterprise values up to £400 million which can benefit from our flexible one-stop financing capabilities and sector expertise."

"Despite a tough trading environment Whitworths has grown and developed its business significantly, under our ownership, having doubled its retail revenues since 2006" said Giles Cheek, Managing Director European Buyouts. "Our long term funding model has allowed us to actively protect the value of our investment and support a new management team in a period of subdued consumer spending and commodity price volatility. The business has evolved to become a much stronger category leader in its core markets with excellent prospects in healthy snacking and home baking. We are delighted to pass the business on in great shape to Equistone."

Established in 1886, Whitworths is a UK based supplier of branded and private label wholefoods such as dried fruit, nuts and seeds. It is the clear category leader in the UK's healthy snacking and home baking markets, both of which are in long term growth. The Company benefits from a portfolio of well known, strong brands such as Whitworths and Sunny and further differentiates itself through its expertise in managing a range of labels and its international procurement and supply chain assurance capabilities. The Company serves all of UK's major retail food stores and has recently entered the Irish grocery market. Whitworths employs 380 people and is headquartered in Irthlingborough, UK.

"We are pleased to have been able to support Whitworths' management team in delivering its ambitious agenda for the Company", commented Ivan Stoyanov, Investment Director. "We wish Peter Utting and the rest of his team all the best in delivering further profitable growth with their new financial backers".

Peter Utting, CEO of Whitworths said "European Capital has provided great support to the Company over the last six years and has helped create a rapidly expanding business in a very attractive market. My thanks to the European Capital team and we look forward to the next stage of development of the Whitworths business with Equistone."

Since its inception in 2005, European Capital Limited has invested €3.5 billion in over 100 companies in Europe including €1.1 billion in One-Stop Buyouts in 9 different companies. Since inception, European Capital Limited has fully exited 59 portfolio companies achieving an aggregate IRR of 8.4%.

Stamford Partners LLP acted as sole financial adviser to European Capital on the transaction.

ABOUT EUROPEAN CAPITAL
European Capital is an investment company for pan-European equity, mezzanine and senior debt investments with €1.1 billion in assets under management. European Capital is a wholly-owned affiliate of American Capital, Ltd ("American Capital"). It is managed by European Capital Asset Management Limited ("ECAM" or the "Investment Manager"), a wholly-owned affiliate of American Capital. The Investment Manager has offices in London and Paris. As of 30 June 2013 the Investment Manager had 5 investment teams with 24 investment professionals and employed 31 support staff. European Capital and its affiliate, American Capital, will consider senior, mezzanine and unitranche debt investment opportunities from 10 million to 40 million in either euros or sterling and up to 400 million for One-Stop Buyouts®. For further information, please refer to www.EuropeanCapital.com.

ABOUT AMERICAN CAPITAL
American Capital, Ltd. (Nasdaq: ACAS) is a publicly traded private equity firm and global asset manager. American Capital, both directly and through its asset management business, originates, underwrites and manages investments in middle market private equity, leveraged finance, real estate, energy & infrastructure and structured products. American Capital manages $21 billion of assets, including assets on its balance sheet and fee earning assets under management by affiliated managers, with $119 billion of total assets under management (including levered assets). Through an affiliate, American Capital manages publicly traded American Capital Agency Corp. (Nasdaq: AGNC) with approximately $10 billion of net book value and American Capital Mortgage Investment Corp. (Nasdaq: MTGE) with approximately $1 billion of net book value. From its eight offices in the U.S. and Europe, American Capital and its affiliate, European Capital, will consider investment opportunities from $10 million to $750 million. For further information, please refer to www.AmericanCapital.com.