Barat Ceramics was a manufacturer of electronic and measurement components, metal-ceramic composites, ceramic wear components and ceramic parts for ballistic applications, particularly for armoured vehicles. Its largest target markets were the electrical engineering and medical technology sectors as well as plant engineering and construction.

The acquisition

Barat Ceramics and Barat Carbide were non-core divisions of Longyear Holdings Inc., a portfolio company of Advent International, which were to be divested ahead of an IPO. Lazard was mandated to identify an acquirer who could take over both businesses quickly and reliably. NEXX convinced the seller and management with its carve-out experience, a hands-on approach and an industrial mindset.

Investment Rationale

Barat Ceramics offered a clear product profile in attractive niche markets, a strong double-digit EBITDA margin and a highly motivated CEO. Growth potential was identified in the geographical expansion (North America, Russia, Asia) and in the further development of the European core business. The location in Eastern Germany also offered structural cost advantages.

Implementation of the growth concept

During the holding period, new customers were systematically won in growth regions, including a leading US medical technology group and a Japanese electronics group. In the ballistic protection segment, the customer base was broadened and project dependency was significantly reduced. With ceramic foam filters for the oil and gas industry and improved tiles for ballistic applications, high-margin product innovations were advanced. The sales organisation was complemented with attractive incentive structures.

Exit

The exit was completed in October 2012 to Steadfast Capital Fund III, a mid-market private equity investor headquartered in Frankfurt am Main, together with the management team.