IGI Private Equity has acquired Tramec S.r.l., based in Calderara di Reno (Bologna), which designs, produces, and distributes gearboxes for industrial applications used in such sectors as automation, packaging, pharmaceutical, agricultural, food & beverage (for which a special antiseptic product has been developed), chemical/plastics, marine, mineral and others.
The share capital was held in equal parts by the founding partners Leo Girotti and Stefano Domenichini, the former serving as Managing Director overseeing the sales division, the latter with responsibility for production and product development. IGI Private Equity has bought 75% of the share capital, while Mr Girotti has reinvested in the transaction with a 25% stake.
The company employs around 130 people and has reached sales of € 30 million, a large part of which is generated abroad. The production of above 130,000 pieces a year is sold in over 70 countries, with Europe accounting for 90% of turnover abroad, while 50% of total sales are in Italy.
Tramec invests around 5,000 hours annually in R&D, developing specific projects for customers, product upgrades and innovations, for example the new line of GHA gearboxes targeting the food sector, with a patented surface treatment of the alloys, specific processing and an innovative layout which create an antibacterial surface, high resistance to corrosion, high thermal conductivity and high surface hardness.
With this deal, the fund IGI Investimenti Sei intends to implement a clear buy & build strategy, aiming to acquire other companies in the motion control segment with the objective of creating a top integrated player in the sector.
At the same time as the closing of the transaction, the first add-on acquisition was finalised; MT Motori Elettrici S.r.l., owned by Virgilio Rende, based in San Giovanni in Persiceto (Bologna), near Tramec, focused on the production of tri-phase and monophase electric motors with or without integrated brakes and motorized drums. MT has 38 employees and generates sales of € 12 million, showing steady growth in the past few years.
“Tramec is a leading Italian manufacturer, well-known for the quality of its products, high level of customer service and significant investments in R&D. We are strongly convinced that the company has margins for growth and will be the platform for consolidation in the sector” says Angelo Mastrandrea, Partner of IGI Private Equity. “As such, our objective is to work together with Leo Girotti to create a centre of excellence for motion control and lay the foundations for a smooth organisational transition.”
“Tramec is a first-generation company; this new step, coming 35 years after the founding of the activity, is the start of a new journey which we undertake with enthusiasm” says Leo Girotti. “With IGI we have set ambitious targets which can be reached thanks to the financial resources and managerial skills made available.”
IGI manages private equity funds specialized in investing in small and mid-cap Italian industrial manufacturers through buyout transactions. Tramec is the fourth investment by the fund IGI Investimenti Sei which has € 170 million in raised funds.
Angelo Mastrandrea, Andrea Bruschi, Alessandro Castiglioni and Anna Paola Schinaia from the IGI team worked on this deal.
IGI was assisted by Euromerger Italia as buy-side advisor; EY provided the financial due diligence; Goetzpartners provided the business due diligence; legal assistance and due diligence from Chiomenti; fiscal assistance and due diligence from Di Tanno Associati; Simmons&Simmons assisted the sponsor banks; Golder provided the environmental due diligence; Prometeia provided the ESG due diligence.
For the vendor side of Tramec and MT, financial assistance was provided by Antonio Bosi of Studio La Croce con Bosi, Ungania, Zambelli and Carlo Mannini of ICS Commercialisti; legal assistance was provided by Pier Luigi Morara, Giuseppe Forni and Andrea Corbelli of BLF Studio Legale and Cinzia Gordini of Studio Gordini e Partners.
The banks involved were BPER Banca, as agent bank, and Crédit Agricole Italia, with legal assistance from Dentons.