• Transactions

FEUER powertrain Expansion of Financing Structure to Include Hold-Co Mezzanine

The Company

The FEUER powertrain Group ("FPT"), headquartered in Nordhausen (Thuringia), is a leading global independent manufacturer of crankshafts for passenger car, truck, agricultural machinery and industrial engines, as well as the segments of leisure vehicles (ATVs, motorbikes, jet skis, sport boats, etc.) and compressors. Although much of the current business is based on internal combustion engine applications, there are still growth opportunities for FPT from an accelerated outsourcing trend and the further diversification of activities.

FEUER powertrain currently operates several highly automated, flexible production lines at its headquarters in Nordhausen, Germany, while a new plant in Tunica, Mississippi (USA) is under construction and a smaller assembly plant is being established in China.

The Transaction

FPT has successfully closed a new mezzanine financing with a total volume of EUR 30 million. The financing was raised as debt capital at the FPT holding level and made available to FPT as equity capital (but in conjunction with an agreed set of regulations regarding servicing and repayment), so that the transaction strengthens FPT's equity capital base and increases the financing flexibility for the further growth of the group.

Specifically, the mezzanine capital is used to finance the development of a new subsidiary in Tianjin (China), which already began supplying selected Asian customers locally in 2015. Furthermore, it makes also a financial contribution to investments in the first production facility at the Nordhausen site, some of the funds were also used to make a technological upgrade as part of a significant expansion of capacity. In addition, the strengthening of the equity base associated with the financing increases the flexibility with regard to the repayment of existing mezzanine capital in the medium term. 

Financing partner is a Pan-European Debt Fund.


Scope of Mandate

ARGONAS acted as FPT's exclusive debt advisor during the financing process, advising and supporting FPT on all aspects of the transaction, including the negotiation of the transaction documents and the integration into the existing financing structure.