GERMANY - EQT finally secures Springer deal

The deal, which is said to be worth as much as EUR 2.3bn, will see EQT acquire 82% of the company's equity, while Singapore's sovereign wealth fund, GIC (Government of Singapore Investment Corporation), will acquire the balance. The transaction, EQT's 18th in Germany, will result in the repayment of all existing debt facilities.

Last month it was reported that EQT had lined up a £1bn financing package to support the acquisition, with Barclays, Goldman Sachs and UniCredit touted as potential underwriters.

The sale represents the culmination of a difficult nine month sale process. In March unquote" reported that the private equity vendors were seeking to dispose of a minority stake in Springer in an effort to raise EUR 500m. Offers fell short of this mark, however: EQT, TPG, Apax and a consortium comprising Providence and Carlyle expressed interested, but are thought to have offered no more than EUR 380m.

By September most of the bidders had fallen away, forcing the sellers to re-consider majority offers. In late November, strategic bidder Informa Business Media began discussions with the company, though these were curtailed when EQT re-emerged with a revised offer, citing too short a time-span to complete the deal.

Springer is a publisher of both global scientific and local-language professional publications in Europe, particularly in Germany and the Netherlands. In the science, technology and medicine (STM) sector the group publishes around 2,000 journals and more than 6,500 new books a year, while it also houses the largest STM eBook Collection worldwide.

The publisher reported turnover of EUR 892m in 2008 and employs 5,000 staff. The business was founded in 1842 and is based in Berlin.

Springer was acquired by Candover and Cinven for more than EUR 1bn in 2003. The company is said to carry EUR 1.9bn in debt after paying out around EUR 1bn in dividends to the private equity owners and was thought to be in danger of breaching its banking covenants.

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