Livonia Partners sells window manufacturer Fenestra to Trigon Capital

14 November 2022

Photo: Founder of Livonia Partners Rain Lõhmus

Livonia Partners, the investment fund founded by Kaido Veske and Rain Lõhmus, sells window manufacturer Fenestra to Trigon Capital.

The deal was prompted by the fact that Livonia's investment in the window manufacturer had matured. "In the case of funds, we can't keep companies for life, we have to find new owners for them with some regularity," explains Livonia's fund partner Kaido Veske.
Through its holding company, Trigon Capital will acquire an 87.22 percent stake in Fenestra, while Livonia Funds will retain a 10 percent stake in the window manufacturer after the transaction. The transaction is subject to the approval of the Competition Authority.

Joakim Helenius, CEO of Trigon Capital said, "Despite the difficult economic situation and despite the government's decisions, Trigon Capital Group is ready to support Fenestra in the difficult months ahead."

Last year Fenestra's revenue grew by 18.7 percent to €20.9 million, but the company still made losses. While operating profit in 2020 was €874,000, it made losses of €599,000. The tax liabilities have now reached almost €309 000.

The net loss was even higher, at €3.4 million, partly due to the decision to close the Loimaa plant in Finland, acquired a few years earlier. These assets are held for sale, with an accounting value of almost €2 million.
Last year's financial performance was heavily affected by the rise in raw material prices and volatility in the security of supply, said the board in its report. As a result, sales contracts signed before the price increases, with longer delivery times, became unprofitable and strongly impacted the financial results.
According to Joakim Helenius, Fenestra is a perfect example of how Estonian industrial companies can compete internationally thanks to high quality. At the same time, he added that the government's decision not to offer energy mitigation measures to industrial exporters, unlike in other EU member states, puts Estonian companies at a disadvantage compared to foreign competitors.

According to him, demand for high-quality, custom-made, and environmentally sustainable wood and aluminum windows will grow in the long term as Europe invests in improving the energy efficiency of its housing stock. Fenestra intends to take advantage of this opportunity to be at the forefront of the high-quality windows market segment and to increase its market share, he added.

According to Kaido Veske, a partner in the Livonia fund, it is too early to think about selling the other glass business, Klaasimeister, which is merged with Baltiklaas. It is currently in a growth phase, starting with one factory and finishing with four. "The ramp-up is in," he added. Klaasimeister could be ready for sale in a couple of years, said Veske.

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Photo credit: Hendrik Osula; Igor SporyninUnsplash

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