Information on the Target

On April 17, 2019, Abris Capital Partners divested its majority stake in Chemes, a prominent player in the label manufacturing sector, to Innova Capital. Over the past 3.5 years of ownership, Abris has significantly developed the company through substantial investments in production infrastructure and technology. These enhancements enabled Chemes to penetrate unexplored markets and expand its customer base, reinforcing its status in the industry.

Since Abris CEE Mid-Market Fund II acquired a majority stake in Chemes in 2015, there has been a strategic focus on growth and innovation. Under the leadership of Maciej Szperliński, the company introduced new product lines, such as laminated tubes, and undertook significant improvements in organizational effectiveness and management structure. These initiatives have led to a marked increase in sales and operational proficiency, establishing Chemes as a recognized name in the label sector. The company now serves both publicly traded and medium-sized FMCG clients across Europe, spanning sectors like cosmetics, personal hygiene, food production, and logistics.

Industry Overview in Poland

The label manufacturing industry in Poland has experienced robust growth in recent years, driven by increased demand across various sectors, including food and beverage, personal care, and pharmaceuticals. The rise of e-commerce and changes in consumer behavior have also contributed to the demand for innovative and sustainable labeling solutions. As companies strive to enhance branding and comply with regulatory requirements, the label market has witnessed a significant transformation.

Experts agree that Poland is ideally positioned as a hub for label manufacturing, given its strategic location in Central Europe and its access to both established and emerging markets. The country's well-developed manufacturing base and skilled workforce provide a competitive advantage, fostering collaboration and innovation among industry players. Furthermore, Poland's commitment to sustainability and eco-friendly practices has spurred growth in the development of green labeling technologies.

As consumer preferences shift towards personalization and sustainability, labels have become essential tools for communication and marketing. This trend has allowed companies like Chemes to thrive, as they innovate to meet the growing needs of various industries. Additionally, the consolidation trend within the sector, as seen with Innova Capital's investments, indicates a bright future for label manufacturers in Poland.

The Rationale Behind the Deal

The sale of Chemes to Innova Capital aligns with Abris Capital Partners' objective to support the growth of Polish family businesses and achieve targeted investment goals. Abris’ investment has yielded substantial improvements in Chemes’ infrastructure, product offerings, and overall market presence, leading to an attractive exit for the firm.

Innova Capital's acquisition represents a strategic move to enhance its portfolio by consolidating key players within the label sector. This deal not only enables Chemes to gain additional resources for further expansion but also synergizes with Innova's existing holdings, particularly Embe Press, creating a more comprehensive service offering for varied customer segments.

Information About the Investor

Innova Capital is a prominent investment firm specializing in the mid-market segment in Central Europe. With a deep understanding of the local markets and a keen eye for promising investment opportunities, the firm focuses on driving value creation through active management and strategic development initiatives. Innova Capital has a history of partnering with businesses to unleash their growth potential, and its investment strategy hinges on enhancing operational efficiencies and improving market positioning.

With a portfolio that includes several key players in the label manufacturing space, Innova has established itself as a significant player in the industry. The firm’s management team, led by Michał Wojdyła, emphasizes the importance of collaboration and innovation within the sector, aiming to elevate its investments collectively for sustained growth and success.

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Considering the strategic nature of Innova Capital’s acquisition of Chemes, this deal appears to be a sound investment opportunity. The robust growth and increased demand for label products in Poland allow for considerable upside potential, especially as the market continues to evolve.

Moreover, with Abris Capital Partners having strengthened Chemes considerably during its ownership, Innova is stepping into an already upgraded operation. This strategic fit between Chemes and Innova’s existing portfolio is likely to provide substantial synergies, facilitating more effective utilization of resources and capabilities.

Investors should also be encouraged by the positive market trends surrounding sustainability and innovative labeling solutions. The ongoing demand across multiple sectors presents Chemes with promising growth prospects, making this acquisition a prudent addition to Innova’s investment strategy. Overall, this deal exemplifies a proactive move to capitalize on favorable market conditions while enhancing competitive advantages.

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