Target Information

ACON Investments, L.L.C. and its affiliates, in collaboration with DeA Capital Alternative Funds SGR SpA, have acquired a controlling stake in Romar Care Group (RGC). RGC, headquartered in Valencia, Spain, is a prominent producer and distributor of personal care, household, and cosmetic products. Established in 2019 through the merger of Quimi Romar and Envasados Xiomara, RGC has experienced significant growth since its inception, more than doubling its production capacity, expanding sales channels, and diversifying its geographical presence.

The company boasts a robust portfolio of brands, including Agrado, Mayordomo, Amalfi, Sairo, Air Freshener, Destello, and Garley. Currently, RGC sells its extensive range of products in over 100 countries worldwide, with a strong presence in Europe, the Middle East, North Africa, and Latin America. Notably, 60% of its revenues are derived from international markets, supported by subsidiaries located in Morocco, Colombia, and the United Kingdom. Key clients include renowned retail chains such as El Corte Inglés, Carrefour, and Lidl.

Industry Overview

The personal care and cosmetic industry in Spain has showcased remarkable resilience and growth, driven by increasing consumer demand for innovative and sustainable products. Spain is one of the leading markets in Europe for personal care products, bolstered by a strong manufacturing base and a thriving export market. The industry's evolution has been further accelerated by rising consumer awareness regarding ingredient transparency and the growing preference for eco-friendly products.

In recent years, Spanish companies have significantly invested in research and development to align with global trends towards sustainability. This shift has not only improved product quality but has also enhanced operational efficiencies. Companies are increasingly adopting ISO certifications and sustainable practices to differentiate themselves from competitors and appeal to environmentally-conscious consumers.

The Spanish government has also supported the industry through various initiatives aimed at promoting innovation and encouraging startups in the cosmetic and personal care sectors. The emergence of e-commerce platforms has facilitated brand reach, enabling even smaller companies to penetrate international markets effectively.

Given the growth prospects in this sector, the demand for personal care products is expected to continue to thrive, driven by factors such as evolving consumer preferences, innovation, and sustainability trends. This backdrop presents significant opportunities for companies like RGC to expand their market share and enhance competitiveness on a global scale.

Rationale Behind the Deal

The acquisition of RGC by ACON and DeA is strategic, aiming to leverage the company’s established market presence and strong brand portfolio to pursue further growth opportunities. RGC’s recent establishment of a state-of-the-art production facility in Sagunto, Valencia, is a testament to its ambition for international expansion and operational optimization, particularly with a focus on energy efficiency and sustainability.

Additionally, the continued commitment of RGC’s management team to drive growth in adherence to ESG criteria, digital transformation, and sustainability further aligns with ACON and DeA's investment philosophies. This synergy is expected to not only enhance operational capabilities but also boost revenue growth through strategic initiatives targeting new markets.

Investor Information

ACON Investments is a leading international private equity firm based in Washington D.C. With a history spanning over 28 years, ACON has successfully managed $7.0 billion in assets across various sectors, including those in the U.S., Latin America, and Europe. Its extensive network and solid track record position it well to support RGC’s growth initiatives.

DeA Capital Alternative Funds SGR S.p.A. is an alternative asset management company focused on mid-market investments that prioritize ESG practices. With over 6 billion euros in assets under management, DeA Capital is renowned for its robust approach to sustainable investing, making RGC a fitting addition to its portfolio as it marks its initial foray into Spain.

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The partnership between ACON and DeA to acquire RGC presents a compelling investment opportunity. Given the company’s solid growth trajectory, established market presence, and commitment to sustainability, this acquisition aligns well with current industry trends that prioritize eco-friendly practices and innovation. RGC’s strategic expansion initiatives, particularly in its new production facility, are set to enhance its operational capacity and market reach.

Furthermore, the increasing consumer preference for sustainable personal care products provides a favorable market environment for RGC’s offerings. This trend suggests promising revenue growth potential, which ACON and DeA are well-positioned to capitalize on, leveraging their industry expertise and global reach.

Additionally, the focus on ESG factors dovetails with broader investor interests, making RGC more attractive to potential stakeholders. The commitment from RGC’s management team to uphold these values indicates resilience and a forward-thinking approach, further solidifying its market positioning.

Overall, this acquisition could serve as a significant milestone for both the investors and RGC, potentially yielding substantial returns while contributing positively to sustainable industry practices.

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