Resource Partners’ commitment to Romania: an investment fund whose size will reach 150mil Euro, a team dedicated to investing on the Romanian market represented by two investment officers – one of whom Romanian – and an investment strategy adapted to suit Romanian businesses
Resource Partners, one of the leading regional private equity fund managers, is targeting Romania as the main market for its third fund, which will have an investment capacity of €150m. They believe that today, compared to 5 years ago, there are many more investment opportunities, mainly due to the increased openness that Romanian entrepreneurs have, but also to a higher appetite for the diversification of investment portfolios.
Why is Romania of increasing interest to investment funds in the region?
Romania, like most CEE countries, has the opportunity to benefit from the rising trends of securing production and manufacturing facilities as close as possible to consumer markets, as well as from the growing demand for the customisation of production. At the same time, the local consumer trends and the dynamism of the entrepreneurial environment represented by new and promising generations contribute to the orientation of more and more regional investment funds towards Romania.
„For Resource Partners, the reasons behind our renewed interest in the Romanian market are the the surprising development and consolidation of the Romanian SME sector in recent years, as well as the nearshoring trend that Romania can benefit from, becoming a solid destination for specialized industrial production ” said Aleksander Kacprzyk, Managing Partner and co-founder of Resource Partners.
Resource Partners investment strategy for Romania
„After the succesful experience with World Class (a business that Resource Partners grew from 6 clubs to 40 through M&As and new location openings, supporting it during the lock-down and pandemic years, and where it made a successful exit last year), the investment fund is targeting another 2-3 deals in Romania in the coming period. The investment tickets for these deals start from €5-7mil and can go up to €20-30mil. There is also an opening for co-investments of up to €50mil with institutional partners (IFC, EIF, EBRD) and with Romanian entrepreneurs” added Aleksander Kacprzyk.
Another part of Resource Partners’ investment strategy for Romania is to integrate more companies from the CEE region, with the aim of creating strong and agile regional players that can enter competitive markets in Western Europe and beyond.
Despite their geographical proximity, Poland and Romania do not fully overlap in the recent consumer trends unfolding over the latest period. One area of difference is the consumption of private label products – whereas in Poland, private label sales have reached 34% of FMCG revenue, in Romania these constitute just 16.2% of FMCG sales and have historically maintained a lower share in the population’s shopping carts. However, there are areas of similarity, especially in what constitutes a resilient industry whose products and services will not easily be downgraded from the consumers’ budget; one such example is the sports and outdoor activities sector, especially given its link with healthcare and overall wellbeing (of which consumers have become increasingly aware in the latest years).
„Resource Partners’ investment policy has been tailored to the local market. Traditionally, the focus of the Polish investment fund was on the consumer goods area as well as impact investing, circular economy and energy efficiency, but on the Romanian market we target companies from all industries. We are looking at investment targets with EBITDA > €1mil, growth prospects, a solid customer base and an appetite for international expansion. Today, we are meeting with companies in different sectors such as innovative equipment manufacturing, consumer health and food.” said Miruna Popa, Investment Associate at Resource Partners.
Investment team dedicated to the Romanian market
Romanian entrepreneurs and managers will benefit from over 20 years of expertise of a complex and comprehensive investment team with a proven track record in managing product portfolio expansion, new market entry and internationalization, resulting in the transformation of strong local leaders into international players in their specific sector, while supporting the transition to a professional management model.
The Resource Partners team is composed of 15 investment professionals operating in the CEE region, all of whom are committed to investing on the Romanian market. They are represented by two investment officers on the local market, one of whom is Romanian.
Aleksander Kacprzyk is Managing Partner & co-founder of Resource Partners and has 20 years of investment experience in CEE, having also worked as Director at The Carlyle Group and started his career at McKinsey & Co. His most notable deals include Nesperta, owner of Semilac – leading brand of hybrid nail polishes, selling in largest cosmetic chains in Europe, Artgeist – e-commerce leader in wall highly customized wall decorations selling directly accross Europe & the US, and Mavit – leader in advanced ophtalmology procedures.
Miruna Popa, Investment Associate at Resource Partners, joined the team a year ago. She started her investment career in investment banking at Morgan Stanley in London, then joined ROCA Investments in 2020, where she led the Artesana transaction and was involved in the Frigotehnica exit to Vinci Energies, as well as in ROCA Industry’s listing on the Bucharest Stock Exchange.
Resource Partners’ investment in Poland, which will also reach Romania
Polish bicycle manufacturer 7Anna, part of the Resource Partners portfolio since 2021, is scheduled to enter Romania with its products starting in May. By the end of the year, its key brands Rondo (gravel and road bikes) as well as NS Bikes (MTB and downhill) models will be available through 20 national distributors, and by 2025 the target is to increase this number to 65.
7Anna is a good example of the roadmap that a Polish fund investment has. The company’s projected sales in 2023 are 3 times higher than when Resource Partners became a shareholder, while the EBITDA margin has remained stable. The involvement of the fund’s team in the management of the company has led to an increased focus on new product development and an increase in the number of markets the company has access to. Today, aside from being present in the US, the largest markets for 7Anna in Europe are Germany, Poland and the UK.
About Resource Partners
Resource Partners is an independent private equity investment company founded in 2009 by a team of experienced fund managers who had invested in CEE region since 2000 on behalf of leading regional and international financial institutions and funds. Since inception, Resource Partners has raised three generations of investment funds which combined with co-investment opportunities for fund investors resulted in total equity investments exceeding EUR 500 million.