Private equity firm Anacacia Capital has invested an undisclosed sum in Home Appliances to help the family-owned business expand and plan for its management succession.
The two-year-old Anacacia began talks about nine months ago with the Varvaressos family, founders of Electrical Distributors Australia, the exclusive brand owners of Euromaid cooking appliances.
Explaining Anacacia's decision to invest in EDA, managing director Jeremy Samuel said companies that produced "good-quality, well-priced products which are essential in the household are in a lot of demand at the moment".
Talks between the family and Anacacia resulted in the creation of a new company, Home Appliances, which acquired EDA and is owned by Anacacia Private Equity Fund, the Varvaressos family and a former Electrolux senior manager, Owen Morgan.
Mr Morgan was appointed the managing director of Home Appliances in March.
The board of Home Appliances includes Mr Morgan and Theo Varvaressos as well as Mr Samuel and Michael Braham of Anacacia's business advisory council as non-executive directors. Mr Braham is also a director of Fisher & Paykel Australia.
Although the sum of the cash injection was not disclosed, Anacacia usually invests in businesses with revenues of $10 million and $50 million, producing earnings of $2 million to $10 million.
"Home Appliances is in the middle of that group," Mr Samuel said.
The investment will be used to help fund succession planning and growth for Home Appliances, which reported record sales for the June quarter.
"People still need to cook and cook at home," Mr Samuel said. "The plan is to focus on building the business longer term, developing relationships with a number of key retailers and growing the Euromaid brand."
The deal, completed last week, was announced yesterday.
© Australian Financial Review 2009