HGT Hg Capital Trust Plc

RNS Number:8239A
HG Capital Trust PLC
25 July 2007


            HgCapital acquires a majority stake in SLV Group

The following is the text of a press release issued by HgCapital, which manages
the investment portfolio of HgCapital Trust plc alongside those of other
institutional clients. The Trust, which is a listed investment trust giving
investors the opportunity to participate in all of HgCapital's investments, will
invest approximately Euro9 million (#6 million) in SLV Group.

          * HgCapital continuing the lighting producer's success story
          * Private equity investor acquires majority stake from company founder

Munich/Ubach-Palenberg, July 25, 2007. European private equity investor
HgCapital is to become the majority shareholder in SLV Group, one of the fastest
growing manufacturers of innovative lighting systems in Europe. The company's
founder and current managing director Franko Neumetzler, who has hitherto held
the majority of SLV's capital, will retain a significant minority stake in the
company in the future, with the other members of management also continuing to
hold shares. The transaction, which is being executed on the basis of an
enterprise value of Euro320 million, still requires the approval of the German
Federal Cartel Office and is expected to be closed in roughly one month's time.

Comprising the parent company S.L.V. Elektronik GmbH, which is based in
Ubach-Palenberg near Aachen, as well as subsidiaries and associates in Germany,
France, Belgium, Switzerland, Hong Kong and Russia, SLV Group has evolved into
one of the most successful European manufacturers of lighting systems over the
past few years. Between 2004 and 2006, its sales surged by a total of 65% to
just under Euro73 million, with a further increase to around Euro90 million projected
for this year. In fact, revenues are expected to double to almost Euro150 million
by 2010. With roughly 160 employees in Germany, the company is highly profitable
and posted earnings before interest, taxes, depreciation and amortization
(EBITDA) of almost Euro25 million in 2006.

Founded in 1979 and achieving growth far in excess of the industry average, the
SLV Group owes its ongoing success to the resolute implementation of what is a
unique strategy in its sector. This strategy combines the development of
innovative lighting systems in Germany with the cost advantages derived from the
early relocation of production activities to less expensive foreign countries in
tandem with highly effective logistics and an efficient multi-channel
distribution system based on strong partnerships.

Following the acquisition of a majority stake by HgCapital, SLV's proven
structures and successful business model will be retained. After almost three
decades at the helm, the company's founder Franko Neumetzler will be gradually
withdrawing from day-to-day management between now and the end of the year,
handing over the reins to a younger generation. Afterwards, he will not only be
a shareholder but also an active adviser to the company. The other key members
of management - Detlef Harms and Toni Stumpf - will retain their positions.
Working in conjunction with the management team, HgCapital will drive continued
efforts to develop foreign business and work towards preparing the company for a
stock market flotation in the medium term.

Justin von Simson of HgCapital in Munich commented: "This is the sixth
investment led by HgCapital's German team. Following the recent acquisition of
toy maker Schleich, the transaction provides further proof of our ability to
forge strong growth-oriented partnerships with successful family-owned companies
as well as reflecting the mounting acceptance of private equity as a source of
finance for German mid-size enterprises. Over the past few years, SLV has
performed superbly and we are certain that it is ideally positioned to grow just
as quickly and profitably as before in Germany as well as in its present and 
future international markets. We will be providing SLV's management with
comprehensive support via our extensive resources and expertise and are
convinced that the company will be ready for the capital market in a few years'
time."

Franko Neumetzler, founder and shareholder/manager of SLV said: "We are very
pleased to have found in HgCapital an experienced and strong investor seeking a
partnership-based relationship with whom we can continue our company's success
story. With HgCapital by its side, SLV will retain its independence, continue to
implement its business model in an undiluted form and unlock new potential. In
this way, we have been able to find an answer smoothly and in good time to the
difficult successor problem, which many small and mid-size shareholder-managed
companies face. In addition, by working with HgCapital we can systematically and
resolutely take SLV to the next level of its economic development- with the
clear perspective of preparing it for the capital market."

HgCapital was advised on this transaction by Sal. Oppenheim (corporate finance),
Clifford Chance (legal), PWC (financial due diligence) and Kurt Salmon
Associates (commercial due diligence). SLV was assisted by investment bank
Dresdner Kleinwort and law firm CMS Hasche Sigle.

For more information:

HgCapital                                   +49 (0)89 2554955 - 0
Justin von Simson

SLV Gruppe                                  +49 (0) 2451 4833 - 95
Franko Neumetzler

HERING SCHUPPENER Consulting                +49 (0)69 921874 -76
Georg Jakobs

About HgCapital
HgCapital is a private-equity investor in the European mid-market. We focus on
investments with an enterprise value in the range of Euro50-500 million. Our
business model combines sector specialisation with dedicated, pro-active support
to our portfolio companies as well as the corresponding management expertise
across all phases of the investment process.
HgCapital manages more than Euro2.7 billion for some of the world's most respected
institutional and private investors. Our goal is to achieve outstanding results
for our investors, management team and intermediaries.

Further information on HgCapital can be found at www.hgcapital.com.

About SLV
Headquartered in Ubach-Palenberg in the German state of North Rhine-Westphalia,
the SLV Group is one of the leaders in the market for innovative lighting
systems and technical and residential lighting. The Group comprises S.L.V.
Elektronik GmbH and the subsidiaries Delta Line & Light GmbH and Lichtwerk
Immobilien Entwicklungs- und Verwaltungs GmbH and is affiliated with a further
five independent international companies. In Germany, the company has 160
employees.

Established in 1979, it solely supplies specialist retailers as a producer and
wholesaler. Its wide range of products encompasses individual lighting systems
for home and exterior uses as well as full-scale high or low-voltage lighting
systems for store and fair construction. The company's own R+D department works
permanently on new products with selected designers and engineers. These are
then manufactured at facilities and partners in the Far East.

Thanks to the carefully planned relocation of production complexes in the Far
East, the restrictive selection of partners and suppliers as well as stringent
quality assurance, the company is able to offer high-quality products featuring
innovative designs at reasonable prices. Minimum delivery times are ensured in
nearly all European countries thanks to favorable transportation links and a
highly efficient logistics center fitted with a high-tech high-bay warehouse at
which 98% of SLV products are kept in stock at all times.
Further information on SLV is available at www.slv.de.




                      This information is provided by RNS
            The company news service from the London Stock Exchange

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