New investors wanted for Pronovias

Pronovias is for sale. The aim is to find new investment partners. They should have the necessary commitment and strength to get the ailing business model back on track. The current owners, the US private equity funds Bain Capital and Clearlake, have made a makeshift restructuring of the structures, but the effects of the corona pandemic on the industry are still being felt.

The British private equity fund BC Partners acquired the company in 2017. As part of the transaction, the fund took over 90 percent of the shares for 495 million euros. The founder Alberto Palatchi retained the remaining ten percent of the group. At the time, this was valued at 550 million euros. Pronovias’ business model fell into crisis. The trigger was the outbreak of the pandemic in 2020, which represented a turning point for the bridal fashion industry. At this point, the company’s high level of debt became an unsustainable burden. This resulted from the leveraged takeover through which BC Partners gained control. The group could hardly meet its obligations to creditors.

In order to find a way out of this situation, a recapitalization agreement was announced in December 2022. Pronovias’ debts were converted into equity. This operation allowed the company to reduce its debt from 385 million euros to 125 million euros. At the same time, private equity firms Bain Capital and MV Credit took control of the bridal fashion group as the new majority shareholders. They took the place of BC Partners. This fund then withdrew completely from Pronovias’ capital. In addition to Bain Capital, the group welcomed the US private equity fund Clearlake as a new shareholder. This came after Clearlake acquired MV Credit in September 2024.

Looking for a new owner for Pronovias

Based on the current capital allocation, Bain Capital and Clearlake have reportedly hired international financial group Rothschild. This was reported by the Spanish daily newspaper El Confidencial. The aim is the sale and divestment process of both private equity firms at Pronovias. Discussions have already been held with various private equity funds for this operation. This allegedly also includes PHI Industrial Acquisitions. This Spanish fund has owned the Valencian porcelain group Lladró since 2017.

So far, however, none of the sales discussions conducted by Rothschild on behalf of Bain Capital and Clearlake have been successful. This has apparently caused the current owners to revise the selling price downwards. Exact details about the amount were not given. However, it can be assumed that they will try to recover much of the funds invested since BC Partners’ exit. This initially amounts to 211 million euros. Bain Capital and MV Credit invested this sum in May 2023. The amount was significantly higher than the originally planned 110 million euros. The investment was made as part of the capital increase to recapitalize the group, which led to the exit of BC Partners. In addition, there is another 28 million euros that the funds injected into Pronovias in 2024.

The company is controlled by Mermaid Topco. Through this holding company, Bain Capital and Clearlake manage Pronovias’ share capital. The group itself operates under the umbrella of the holding company Catiberia Acquisition Holdco. The last available economic figures come from the 2023 financial year. The company closed the year with sales of 135.8 million euros. This corresponds to a decrease of 8.9 percent. The net loss amounted to 128.5 million euros.

In July 2024, a personnel adjustment at headquarters was agreed. Financial indicators are expected to improve through the implementation of the new strategic plan for the period 2025 to 2027. The company began implementing this medium-term roadmap at the beginning of the year. It was designed by Marc Calabia, who handed over the management to Cristina Alba Ochoa at the end of July.

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