Private equity firm Advent bought a 25% stake in building materials maker Grupo Tigre for 1.35 billion reais, the companies said on Friday, eyeing an infrastructure boom in the United States and in Brazil.
Tigre plans to use the funds raised to acquire competitors, open new production lines at current plants and build new ones, Tigre chairman Felipe Hansen said in an interview.
Founded in Brazil by the Hansen family about 80 years ago, Tigre has expanded throughout Latin America, with factories in countries such as Argentina, Chile and Colombia, and to the United States.
In Brazil, Tigre’s president, Otto von Sothen, sees growing demand for products such as pipes, with a new legal framework approved in 2020 providing for the universalization of sanitation services by 2033. Irrigation projects are also on Tigre’s radar.
In the US, where the manufacturer has three factories, Tigre plans to take advantage of President Joe Biden’s $1 trillion infrastructure package.
Patrice Etlin, a partner at Advent, said the private equity firm sees room for consolidation in the US building materials industry. The manager used resources from its seventh fund for Latin America, worth US$2 billion, for the business.
Tigre recorded net revenue of BRL 4.2 billion in the first nine months of 2021 and net income of BRL 508 million.
Advent will appoint two of the seven members of Tigre’s board of directors.
Source: CNN Brasil
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