Palamon Capital Partners has sold Espresso House to Norwegian private equity firm Herkules Capital, generating a 3.4 times multiple.
Palamon, after spotting a gap in the market in 2005, acquired two Swedish coffee bar operators, Espresso House and Coffee Cup, for a combined SKr103m (€12.2m). From a base of 37 outlets, the company grew organically and now operates 120 outlets across Sweden. Today the company employs around 900 staff. Over the last six years revenues have increased by 30 per cent each year to SKr560m, with Ebitda rising more than ten times.
“Espresso House has outperformed its competitors and we believe there is strong potential for further growth,” said Sverre Flåskjer, partner at Herkules Capital.
The deal marks Palamon's eighth exit from its 2006 fund, Palamon European Equity II, which has generated realised returns of 2.6 times on invested capital in fully exited companies.