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CMS and Gessel Advise on iCotton Acquisition of Controlling Stake in Harper Hygienics

CMS and Gessel Advise on iCotton Acquisition of Controlling Stake in Harper Hygienics

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CMS has advised iCotton, a manufacturer of hygiene products in Eastern Europe, on its acquisition of a controlling 59.95% stake Harper Hygienics from Polish Enterprise Fund V, a private equity fund managed by Enterprise Investors. Gessel advised the sellers on the deal.

Founded in 1990, Harper Hygienics is a Polish producer of skin care products. Since 2010, it has been listed on the Warsaw Stock Exchange. It has a workforce of over 500 people, and its revenue for Q1 through Q3 2016 was PLN 155 million. Harper Hygienics’ main product is Cleanic cotton pads. iCotton is based in Latvia and has a distribution network in Ukraine, Belarus, Kazakhstan, Moldova, Tajikistan, and Uzbekistan, as well as a production facility in Latvia.

Active since 1990, Enterprise Investors is one of the largest private equity groups in Central and Eastern Europe. It has established eight funds with combined capital of over EUR 2 billion. The various Enterprise Investors funds have invested over EUR 1.7 billion in 137 companies from various sectors and effectuated 120 exits, achieving gross revenue approaching EUR 3 billion.

“This transaction is perfect evidence of a business development strategy that is based on the acquisition of favorably valued assets," said Rafal Kluziak, responsible for the project at CMS. "In experienced hands, transactions of this kind can be a very effective tool for expansion into new markets, as the purchaser can benefit from a well-established brand and the existing potential of the purchased company, as well as its client portfolio."

Kluziak was supported by CMS Senior Lawyer Julita Mazurkiewicz. The firm's team also included Lawyers Jakub Szczygieł and Karolina Stepaniuk from the Corporate/M&A Department, Senior Lawyer Michał Lisawa from the labor law team, Lawyer Adriana Zdanowicz in the intellectual property protection and new technologies team, and Kyiv-based Partner Olga Belyakova and Moscow-based Partner Maxim Boulba. The Supervising Partner on the project was Michal Pawłowski, from the firm's Corporate/M&A Department, who heads CMS’s capital markets team in Central and Eastern Europe.

The Gessel team working on this project was supervised by Managing Partner Marcin Macieszczak and was led by Advocate Karol Sokol, with input by Bartłomiej Wozniak and Michał Osowski. The firm previously advised PEF on its acquisition of a 75% stake in Harper Hygienics in 2004 and the remaining 25% in 2007, and on Harper Hygienics’ IPO in 2010.

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