Nordhaven advised City of Helsinki in the sale of Palmia Oy to Mutares

21 dec 2022

Mutares SE & Co. KGaA has signed an agreement to acquire Palmia Oy from the City of Helsinki. The company will strengthen its Goods & Services segment as a new Finnish platform investment. The transaction is expected to close in Q1 2023, subject to approval by the Finnish Competition and Consumer Authority.

Palmia Oy offers food, real estate, cleaning, and security services in 12 different municipalities throughout southern Finland. The company was incorporated at the end of 2014 by the City of Helsinki. The company is expected to generate revenue of approximately EUR 120 million in 2022, and currently has around 2,400 employees.

The transaction will allow Palmia to focus on and further develop services for its current customers. The change in ownership will not affect the contracts between Palmia and its customers, and will allow Palmia to review its strategic priorities and to focus on growth into new customer segments.

Johannes Laumann, CIO of Mutares SE & Co. KGaA, comments: "With this transaction Mutares further builds on its successful presence in Finland. We are very happy to welcome Palmia Oy to our portfolio and will do our utmost with our team and management to repeat at Palmia Oy the success we had with Nordec Group Oyj. Here we managed to exceed Mutares' official ROIC target of 7-10x. Our successful track record makes it clear that such successes are reproducible. We are working on this with Palmia Oy as well from now on."

Mutares is headquartered in Munich, Germany and operates through its 12 offices in nine countries, employing more than 16,000 people through its various holdings. Mutares' holding companies generated approximately EUR 2.5 billion sales in 2021.

"We are happy that together with Nordhaven we have been able to find a new committed owner for Palmia and expect the company to develop further as a quality service provider for Helsinki and other clients. Although the recent years have been difficult for Palmia due to Covid and other recent market environment changes, Palmia's incorporation has been a success due the significant cost savings it has provided for the city", says Leena Saarinen, Chairman of the Board at Palmia.

"In this process we learned that Palmia has developed strong expertise in many of its service areas. We firmly believe that we have found a new owner who can further nurture Palmia to be a leading player in many of its service areas, with vast opportunities in, for example, the health sector, where newly established wellbeing services districts have a growing need for specialized service providers", says Ari Leppänen, Partner at Nordhaven.

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