Bridgepoint Contemplates Sale of Swedish Drinks Business

Bridgepoint, a UK-listed private equity group, is considering options including the sale of Vitamin Well, a Swedish drinks business it has owned for eight years. The company is working with advisers to explore the possibility of bringing in new owners or minority investors and could be valued at more than €2bn, generating roughly €150mn in earnings. This decision comes as the buyout market is starting to heat up after a slow 18 months, with higher interest rates and valuation mismatches between buyers and sellers affecting private equity groups. Vitamin Well, launched in 2006 and based in Stockholm, manages three main brands and operates in 40 markets worldwide. Any potential sale would mark the end of Bridgepoint's eight-year ownership of the company and would be a boost to the firm, whose performance-related earnings have seen a decline in recent years.

Key Takeaways

• Bridgepoint is considering selling Vitamin Well, a Swedish drinks business it has owned for eight years.
• The company generates roughly €150mn in earnings before interest, tax, depreciation, and amortisation, with annual revenues of roughly €500mn in 2023.
• The sale exploration is in the early stages, and there is no certainty of a deal due to the recent struggle in the buyout market.
• Vitamin Well, which includes brands like Nocco and Barebells, has a significant market presence in 40 countries and offices across Europe, the US, and Asia.
• Any sale of Vitamin Well would be a boost to Bridgepoint, as its performance-related earnings have seen a decline in recent years.

Analysis

Bridgepoint's potential sale of Vitamin Well could be influenced by the fast-evolving buyout market, impacted by factors such as rising interest rates and valuation discrepancies. The sale could impact Vitamin Well's operations across 40 markets and Bridgepoint's earnings, which have been declining. The exploration for new owners or minority investors indicates a need for revitalization. Short-term impacts could include potential market volatility, while the long-term consequences may involve restructuring and strategic realignment. The sale could also affect potential buyers, the private equity sector, and shareholders. This move could usher in a new era for both Bridgepoint and Vitamin Well, potentially reshaping their market positions and strategies.

Did You Know?

• Vitamin Well generating €150mn in EBITDA: EBITDA stands for Earnings Before Interest, Taxes, Depreciation, and Amortization, which is a key financial metric used to assess a company's operating performance. It provides a clearer picture of the company's profitability by excluding non-operating expenses and non-cash charges.

• Buyout market struggling due to higher interest rates and valuation mismatches: The buyout market refers to the market for acquiring control of a company through the purchase of its shares. The struggle in the buyout market is attributed to factors such as higher interest rates and valuation mismatches, which are negatively impacting private equity groups' ability to complete deals effectively.

• Bridgepoint's declining performance-related earnings: This refers to the decrease in Bridgepoint's earnings linked to its performance, indicating a potential need for strategic changes or restructuring within the organization. It highlights the significance of the potential sale of Vitamin Well in boosting Bridgepoint's overall performance and financial position.