AIG Global Emerging markets invests in UTI and sets the basis for international development
Today, November 28, 2005, there are being signed the final documents, for the AIG Global Emerging Markets Fund II takeover for 30% of UTI Group’s stock. The rest of the stock, 70%, will remain under the control of the same stockholder, Tiberiu Urdareanu.
The total worth of the transaction amounts to approximately USD 20M. This direct investment of the largest financial group will bring about an appreciable increment of UTI’s capital, allowing it to develop and to rapidly go international in the years to come.
UTI was assisted and represented, during negotiations, by the Linklaters, Miculitii si Asociatii law firm and by KPMG Romania for financial and fiscal matters. AIG GEM II turned to White and Case and Fruth Oprisan, Popescu & Asociatii SCA law firms, and for matters linked to accountancy, to BDO Conti Audit Inc. firm. Given the diversity and complexity of UTI’s activity, the legal and operational evaluation processes were extremely complex and detailed.
Within the due diligence process, the highlight was, besides the legal and fiscal aspects, the business development plan for the next 4 or 5 years, the sustainability development in each of UTI’s three domains of activity, as well as the evaluation of UTI’s current capabilities and human resources. UTI will continue to activate in the same domains, with the same management existing today. The assets increment, resulted from the cession of 30% of the stock, will be used to finance important projects for the development of new products and services, to approach new business lines, to internationalize the activity, as well as to acquire companies with complementary activities.
The priorities for the year 2006 will be the optimization of the operational performances and the development of new products. An important part of the investment will be allocated to the internal processes optimization and for the development of managerial capabilities, as well as of technical endowments.
ABOUT AIG
AIG Global Emerging Markets Fund II, L.P. is the newest fund managed by AIG Capital Partners, an affiliate of American International Group (“AIG”), one of the largest companies of insurance and international financial services.
AIG-CET Capital Management also managed the regional fund AIG New European Fund (“AIG NEF”), a fund which invested over USD 250M in Central and Eastern Europe.
In Romania, AIG NEF invested over USD 80M in Astral Telecom, Orange Romania and Luxten Lighting, investments it successfully resold, in its turn.
For the time being, AIG GEM II does not record any participation in Romania, UTI Group being the first investment in the region.
ABOUT UTI (www.uti.ro, www.uti15ani.ro)
UTI is a company with 100% private capital, specialized in solutions and services in the following domains:
- Security systems
- IT&C
- Mechanical and electrical installations
Established in 1990, UTI has recently celebrated 15 years of activity. Throughout this period, UTI has actively participated with original products, solutions, and services to the economic development in Romania. Its anniversary logotype “UTI 15 years – A New Beginning” underlines the opportunity created by the capital infusion and the wish of the two partners, UTI and AIG, to significantly increase the value of the company, through a sustainable development.
UTI became established as a leader on the security systems market and it ranks among the first 2-3 players in the rest of the domains.
UTI owns an important intellectual property, represented by an impressive number of patents and registered marks, the results of a major effort of research and development. The consolidated turnover in 2004 reached EUR 47M, and the operational profit and EBIDTA, referring to the same period of time, amounted to EUR 6.2M and, respectively EUR 7.2M. In 2005 it is estimated a consolidated turnover of EUR 59-60M, an operational profit and EBIDTA of appreciatively EUR 9M, respectively EUR 10M.
For the year 2006 there was budgeted a turnover of 72.052 thousands EUR and an operational profit of 12.248 thousand EUR (and an EBITDA of 13.689 thousand EUR), consolidated at the group level.
Image and Public Relations Director
Lucia Urdareanu
UTI GROUP
AIG acquires UTI stake
Bucharest Business Week, vol. 9, no. 42,
December 5th, 2005
International fund takes over 30 pc of UTI Group
Nine O’Clock magazine, November 29th, 2005
(pdf, 296 Kb)
