Mayanot Eden, the outfit behind Mey Eden mineral water, is selling its Israeli and European operations to U.S. investment firm Rhone Capital for 70 million euros, the Israeli company said Sunday.
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Mayanot Eden had said in its first-quarter report it expected the deal to close at under NIS 170 million, so Sunday's modest price tag sent the stock down 5.5% by mid-afternoon. The sale price reflects an enterprise value, which includes debt, of 240 million euros.
New York-based Rhone Capital is a private equity firm founded in 1995 by billionaire financiers Robert Agostinelli and Steven Langman. It also has offices in London and Paris.
Mayanot Eden, which markets mineral water from the Golan Heights, has increasingly focused on coffee. Rhone Capital is expected to be interested in expanding that business as well.
The CEO of the Eden Springs Holland subsidiary, Raanan Zilberman, will stay on board under the new owners. The sale is an opportunity to speed up the company's expansion, he said.
Such expansion requires investments in marketing, equipment, business development and acquisitions, not only in water but also in coffee services for homes and businesses, Zilberman said.
The company is also eyeing expansion in Eastern Europe, where demand for mineral water is growing. "We are pleased to cooperate with Rhone Capital in carrying out the joint vision and believe that Rhone's experience in creating value for the operations it buys will be a significant contribution to the company's development," Zilberman said.
Mayanot Eden's controlling shareholders are Ron and Yehuda Naftali, followed by New York-based hedge-fund and asset-management firm Och-Ziff. Mayanot Eden earned 1.8 million euros on revenues of 61.6 million euros in the first quarter, compared with an 829,000-euro loss on revenues of 60.5 million euros the year before.
The Naftali brothers signed an investment agreement with Och-Ziff in 2007, when the latter invested tens of millions of euros in Mayanot Eden and lent another 25 million euros. As part of the deal, Och-Ziff received an option under which it could force the other shareholders to sell when it did. That option went into effect in December.
Rhone Capital specializes in leveraged buyouts and mergers and acquisitions, focusing on European and transatlantic deals. It has investments in industries such as chemicals, consumer goods, food, mining and transportation.