Goldman - PAI acquire German building materials firm Xella

16 July 2008

Goldman Sachs Capital Partners and France's PAI Partners yesterday said that they would jointly buy out family-owned German building materials group Xella International GmbH. Other bidders in the race to acquire the maker of bricks, drywalls and building materials, included Irish firm CRH plc and Austria's Wienerberger AG.

Xella, which was founded in 2002 out of the Haniel Group's existing building materials portfolio, has become a world market leader for aerated concrete and calcium-silicate blocks. It was no longer considered core in the long-term strategic orientation of the Haniel Group, which generated sales of €29.2 billion in 2007.

Goldman and PAI will pay Franz Haniel & Cie GmbH, the German family-owned investment group that owns Xella, around $3.2 billion. Xella had sales of  of €1.3 billion last year.

Haniel said ot had undertaken a detailed evaluation of all options, and at the beginning of the week, accepted the management board's recommendation to sell its construction materials division Xella, to sell it to the Goldman - PAI consortium adopting a structured bidding process, during which Haniel Group was advised by Deutsche Bank, Deloitte and Clifford Chance.

It said that after regulatory approvals, the transfer of ownership would apply retrospectively as of 31 March 2008.

''Our corporate social responsibility and optimisation of profit are the two equally weighted values at Haniel with regard to the strategic positioning of our portfolio'', said Eckhard Cordes, CEO of the Haniel Group. ''These two motifs have been key to us in the process of looking for an appropriate new owner for Xella and we are convinced to have found the right partners with the adequate financial strengths and industrial expertise.''