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Private equity in action - Case Study

PE in CEE - Magnetic MRO

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Full-service aircraft MRO specialist

Transforming a corporate low-margin airframe maintenance business into an independent full-service and aftermarket specialist with global reach

 

COUNTRY

Estonia

RETURN 4.6x
GP BaltCap GROWTH 7x revenue
INVESTMENT EUR 7.1 million EMPLOYMENT 260 new jobs
SECTOR Aircraft maintenance INVESTMENT TYPE Buyout and growth
INVESTMENT February 2010 FUND OWNERSHIP 100% 
EXIT March 2018 EXIT ROUTE Trade sale

Investment rationale
In 2010 Magnetic MRO was predominantly a subcontractor to its parent company, Scandinavian Airlines (SAS). BaltCap saw an opportunity to create an independent aircraft MRO (maintenance, repair and operations) provider that would be well positioned to serve the European and CIS markets from its base in Estonia. With the industry moving from selling manhours to providing comprehensive technical care, improved margins were possible. BaltCap aimed to triple Magnetic’s capacities by developing modern hangar facilities in partnership with Tallinn Airport.


Deal history and structure
BaltCap acquired 100% of Magnetic MRO from SAS in a limited auction process. The equity ticket was EUR 5 million. A further EUR 2 million was provided in 2012–2013 for additional investments. BaltCap’s shareholding was diluted to 70% in 2014 when an incentive package was introduced for the incoming management team.

 

Magnetic MRO

BaltCap

In this section
Private Equity in CEE: Creating Value and Continued Growth Image

Private Equity in CEE: Creating Value and Continued Growth

11 Feb 2021
Invest Europe

The report offers an in-depth study of private equity’s role in innovation and economic development across Central and Eastern Europe through detailed case studies of companies backed by private equity investors during 2015-2019.

Download PDF 8.26 MB
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