Information on the Target

Liking S.p.A., based in San Martino di Lupari (Padova), specializes in the production of hard and filled candies, toffee, tablets, and organic candies. With a history dating back to 1910 when it was founded by Giuseppe Corno, the company has evolved from a small artisan workshop to a significant industrial player. Currently, Liking operates from a 16,000 square meter facility and employs approximately 40 staff members. The company boasts a production capacity that allows it to package up to 22 tons of hard and filled candies, 1 ton of tablets, and more than 8 tons of toffee daily. Liking has successfully established a robust sales network in Italy, and its exports account for over 30% of its total revenue.

In 2020, Liking recorded revenues of €10 million with a margin of 20%, while maintaining a strong net financial position. Despite challenges presented by the COVID-19 pandemic, the company demonstrated resilience, achieving comparable results in 2021 with a positive second half of the year that offset initial downturns. The recent acquisition aims to bolster Liking's growth trajectory, enhancing its commercial operations and expanding its geographical presence.

Industry Overview in Italy

The Italian confectionery industry, particularly in the segment of hard and filled candies, has shown significant potential for growth. Traditional manufacturing practices combined with modern automation have positioned many Italian companies as key players in the market. The industry benefits from a growing demand for both high-quality products and innovative offerings that align with consumer trends toward health and sustainability.

In recent years, the market has witnessed increased interest in bio and organic products, prompting manufacturers to adapt their portfolios accordingly. This shift not only attracts environmentally conscious consumers but also opens up new distribution channels, both domestically and internationally. The revenue generated from exports continues to climb, highlighting the competitive nature of Italian confectionery products outside local markets.

Furthermore, the pandemic has accelerated changes in consumer behavior, leading to a surge in e-commerce and direct-to-consumer sales, providing additional challenges and opportunities for growth within the industry. Italian confectionery firms are now strategically focusing on enhancing their online presence and diversifying their retail strategies to capture these burgeoning market segments.

The Rationale Behind the Deal

This acquisition represents FVS SGR's commitment to supporting family-owned businesses in their generational transitions while fostering growth in the Italian confectionery market. By acquiring a majority stake in Liking S.p.A., FVS aims to leverage the company's established market presence and operational efficiency to implement a comprehensive growth strategy.

The investment is designed to not only facilitate the commercial strengthening of Liking but also to explore opportunities in new markets and distribution channels. The forward-thinking plan includes product innovation and expansion of Liking's offerings to respond to evolving market trends, with an emphasis on collaboration and the potential for further mergers and acquisitions within the sector.

Information about the Investor

FVS SGR is a subsidiary of Veneto Sviluppo, a regional finance agency dedicated to supporting the growth of small and medium-sized enterprises (SMEs) in the Triveneto area, comprising the regions of Veneto, Friuli Venezia Giulia, and Trentino Alto Adige. Following the successful deployment of the first 'Fondo Sviluppo PMI', which invested €50 million across eight participations, FVS has launched 'Fondo Sviluppo PMI 2' with a target fundraising of €75 million. This new fund is focused on making significant equity investments in SMEs with revenue ranging from €10 million to €180 million.

FVS has strategically gathered capital from a mix of institutional investors, including financial institutions, pension funds, and family offices, thereby ensuring that investments contribute to tangible growth within the local economy. The firm's approach emphasizes collaboration, leveraging fresh capital to assist healthy businesses in navigating generational transitions and market consolidations.

View of Dealert

From an expert perspective, the acquisition of Liking S.p.A. by FVS SGR stands out as a potentially profitable investment. The strategic integration of Liking's well-positioned brand, combined with FVS's expertise and resources, could enhance the company's market reach and operational capabilities significantly. The established history of Liking coupled with its demonstrated resilience during challenging market conditions positions it as an attractive addition to the fund's portfolio.

Furthermore, the focus on innovation and market expansion as articulated in the growth strategy aligns well with current trends in the confectionery industry. By actively pursuing the development of new products and exploring untapped markets, the partnership could elevate Liking's competitive stance both locally and internationally.

The backing from FVS provides a strong platform for the family-owned business to adapt to industry shifts and potential challenges while maintaining its legacy and operational integrity. The recognition of the need for generational support illustrates a proactive approach that bodes well for both the management team and investors involved.

Overall, this deal signals a promising trajectory for Liking S.p.A., supported by a solid strategic framework and the expertise of FVS. If executed according to the outlined plan, this acquisition could provide substantial long-term value for stakeholders, making it a commendable investment opportunity in the rapidly evolving confectionery sector.

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