Pronovias reportedly up for sale

Madrid – Pronovias is up for sale. The goal is to find a new investment partner with the commitment and strength necessary to fully turn around its struggling business model. Its current owners, US private equity funds Bain Capital and Clearlake, have managed to patch up the structures. However, they remain affected following the disruption caused to the sector by the outbreak of the Covid-19 pandemic.

British private equity fund BC Partners acquired the company in 2017. The deal involved purchasing 90 percent of the company for 495 million euros, leaving founder Alberto Palatchi with the remaining 10 percent of the group, which was valued at 550 million euros at the time. The Pronovias business model entered a crisis following the watershed moment for the bridal fashion sector caused by the outbreak of the Covid-19 pandemic in 2020. At that time, the high debt carried by the company, a result of the leveraged buyout by which BC Partners had gained control, began to act as an excessive burden. This started to prevent the group from meeting its obligations to creditors.

In an attempt to resolve this situation, a recapitalisation agreement was announced by December 2022. Under this agreement, Pronovias debt was converted into equity. This operation allowed the company to reduce its debt from 385 million euros to 125 million euros. Simultaneously, private equity firms Bain Capital and MV Credit took control of the bridal group as new majority shareholders, replacing BC Partners, which exited Pronovias entirely from that moment. The group welcomed US private equity fund Clearlake as a new reference shareholder alongside Bain Capital after the former acquired MV Credit in September 2024.

Search for a new owner for Pronovias

Based on this current capital distribution, generalist media outlet El Confidencial has reported that Bain Capital and Clearlake have hired international financial group Rothschild to address the sale and divestment process of both private equity firms in Pronovias. Conversations have reportedly already been held with various private equity funds for this operation. It is openly noted that these include Spanish firm PHI Industrial Acquisitions, which has owned the Valencian porcelain group Lladró since 2017.

The cited sources indicate that none of the conversations opened by Rothschild on behalf of Bain Capital and Clearlake to agree on the sale of Pronovias Group have reached a successful conclusion so far. This circumstance has reportedly led its current owners to begin adjusting the starting sale price downwards. No further details have been given regarding this amount. However, it can be assumed they would try to recover a large part, if not all, of the funds invested in the company since the exit of BC Partners. These amounts include the 211 million euros that Bain Capital and MV Credit invested in May 2023, well above the 110 million initially planned. This investment was part of the capital increase that supported the group's recapitalisation leading to the exit of BC Partners. These funds were supplemented by an additional 28 million euros injected into Pronovias by the funds in 2024.

Controlled by Mermaid Topco, the holding company through which Bain Capital and Clearlake manage Pronovias share capital, the group operates under the umbrella of the holding Catiberia Acquisition Holdco. Regarding the latest available financial figures for Pronovias Group, the company closed the 2023 financial year with sales of 135.8 million euros (down 8.9 percent) and net losses of 128.5 million euros. Following the workforce adjustment at its headquarters agreed in July 2024, it is hoped that these financial indicators have been “stimulated” through the implementation of its new strategic plan for 2025 to 2027. This medium-term roadmap began execution earlier this year. It was designed by Marc Calabia, but Cristina Alba Ochoa, the new CEO of Pronovias Group, has taken the reins since late July.

This article was translated to English using an AI tool.

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