€70m capital increase to reduce Burgo’s debt and help the group to complete the restructuring plan initiated in 2015.
Italy’s private equity firm Quattro R has reached an agreement to acquire a controlling stake in the Burgo group in partnership with Holding Gruppo Marchi (HGM). Quattro R and the Marchi family holding company will form a 50/50 joint venture, which will hold 91 % of Burgo. To this aim Burgo group will perform a capital increase of €70m, entirely financed by Quattro R. HGM currently holds a 50.59 % controlling stake in Burgo.
According to Quattro R and Burgo, several minority shareholders including Mediobanca, Generali, and Italmobiliare agreed to maintain their participation in Burgo share capital.
The capital increase is meant to reduce Burgo’s existing debt, allowing for the “successful termination of the restructuring plan under art. 67 of the Italian Bankruptcy Law entered by Burgo in 2015,” Burgo and Quattro R announced in a joint press release on 29 September.
Furthermore, the transaction is said to accelerate Burgo’s strategic repositioning from graphic paper towards packaging paper, and from virgin fiber-based papers towards recycled fiber-based products.
Quattro R, HGM, and Burgo have already notified the European Commission (EC) of the proposed concentration. According to EC, the case is a candidate for examination under a simplified procedure. The provisional decision deadline was set for 22 October 2020.