PE fund Rabo Equity sells 21.7% stake in Vacmet

MUMBAI: Rabo Equity Advisors, the food and agriculture-focused private equity fund, has sold its 21.7 per cent stake in Vacmet back to its promoters, making around 2.5 times returns on its investment.

Almost a decade after the fund invested Rs 50 crore in the company, it has exited through buyback from promoters over two tranches, the fund said in its release.

Vacmet Ltd is a maker of flexible packaging material, producing BOPP Films, BOPET films and other specialty films at its three plants in Chatta (Mathura), one at Agra and Mathura each.

The company is backward integrated and makes its own resin for films. It also adds value to the films by vacuum metallizing and lamination and supplies to large converters and actual user corporate across India and over 70 countries. The films are consumed largely in food and agri sectors.

“Vacmet has been growing at over 20 per cent each year and from a revenue base of Rs 257 crores in FY 2010 when the Fund invested, it has reached a revenue of Rs 1,848 crores in FY20 with an EBITDA of Rs 363 crores,” the release said.

The company is managed by Dinesh Chandra Agarwal and his family.

“It has been a very pleasant journey with Rabo Equity with Rajesh Srivastava leading his team. His insights and all-round support have been a major reason for our best practices and strong growth. We have established ourselves as a professionally run company clinching all milestones in operations and governance,” said Agarwal, chairman and managing director, Vacmet.

“Vacmet has been a great investment for us. We always looked for companies where we could add value through our superior sector knowledge and outreach, associating with strong yet receptive management. Our returns get notionally notched up when the company espouses sustainable best practices for the long term. Vacmet is a clear winner here. We have proud to have partnered Vacmet in its growth,” said Rajesh Srivastava, executive chairman, Rabo Equity Advisors.

For Rabo Equity, this is the seventh exit out of its ten investments made in India. “..the remaining three (exits) are estimated to be secured by early next year. The portfolio has been well spread across agribiotech, vegetables, packaging, dairy and nutraceuticals and has already returned the principle and a decent return to its investors,” Rabo said in its release.

Rabo Equity Advisors Private Limited is a 51 per cent Rabobank held company with the senior employees of the company owning the balance 49 per cent shares with offices in New Delhi and Mumbai.