FIMI Offers $50 Million for Control of Pool Robot Maker Maytronics
Translated & summarized from Bizportal by baba
FIMI Opportunity Fund has offered to invest NIS 200 million for a controlling stake in Maytronics, a pool robot manufacturer, valuing the company at NIS 200 million pre-money. The offer includes options for FIMI to invest up to an additional NIS 150 million, potentially giving it 60% ownership. This investment would dilute the founding Kibbutz Yizre'el's stake to a minority position. Maytronics, which has faced financial difficulties after a period of high growth, granted FIMI exclusive negotiation rights for 60 days.
The story in 5 lines · by baba
- FIMI offers NIS 200 million for a controlling stake in Maytronics, a pool robot maker.
- The initial investment values Maytronics at NIS 200 million pre-money, with potential for NIS 350 million total.
- FIMI's investment could reduce the founding Kibbutz Yizre'el's ownership from 56% to 22%.
- Maytronics granted FIMI exclusive negotiation rights for 60 days to finalize the deal.
- The company seeks investment to address financial difficulties after a period of high growth and subsequent decline.
FIMI Opportunity Fund has submitted a non-binding offer to invest NIS 200 million (approximately $50 million) in Maytronics, a leading manufacturer of robotic pool cleaners. The proposed investment values the company at NIS 200 million pre-money, with FIMI acquiring about half of the company's shares immediately after the allocation. The offer price per share is NIS 1.821, representing a slight discount of around 8% to Maytronics' closing market price of NIS 218 million.
Beyond the initial investment, FIMI has two options to increase its stake. The first allows for an additional NIS 50 million investment at NIS 2.276 per share, valuing the company at NIS 250 million pre-money. The second option permits a further NIS 100 million investment at NIS 2.732 per share, valuing the company at NIS 300 million. These options, exercisable over extended periods, would allow FIMI to decide on further investment based on the success of Maytronics' recovery plan. If FIMI exercises both options, investing a total of NIS 350 million, it would hold approximately 60% of the company.
This potential investment would significantly dilute the stake of Kibbutz Yizre'el, the company's founder, which currently holds about 56%. Following the initial investment, the kibbutz's share would drop to around 28%, and further to about 22% if both options are fully exercised, transforming it from a controlling shareholder to a minority stakeholder.
Maytronics has granted FIMI an exclusive 60-day period for due diligence and to finalize a binding agreement. The deal is contingent upon several conditions, including the completion of due diligence, signing of investment and shareholder agreements, approval from Maytronics' governing bodies including its general assembly, and any necessary regulatory approvals. To ensure fair terms for all shareholders, Maytronics' board has appointed an independent committee, comprising members of the audit committee, to manage negotiations, a common practice when the controlling shareholder has differing interests.
Maytronics, founded in 1990 by Kibbutz Yizre'el, is renowned for its Dolphin brand of robotic pool cleaners and has expanded into automatic pool covers, anti-drowning alarms, and water treatment products. The company experienced significant growth, particularly during the COVID-19 pandemic, reaching a market value of approximately NIS 9.1 billion in late 2021. However, a post-pandemic market downturn, increased competition from cheaper Chinese manufacturers, and product issues led to a sharp decline in revenue and a net loss of approximately NIS 222 million for the last full year. The company faces a NIS 600 million bank debt and a reduced equity of NIS 314 million, necessitating the search for a new investor to reduce debt, optimize production, and strengthen direct-to-consumer sales.
