Mega-buyouts stage a comeback

The largest completed deal this month was Group Arnault's private equity wing Financiere Agache Private Equity taking a 37.74% share in Paprec, a recycling and waste management business, for EUR100m (see page 37). Eclipsing that deal however was the prospect of the two largest deals of the year nearing completion.

Large buyouts seem back on the agenda after exclusive negotiations began involving two ex-Alstom companies. Barclays Private Equity staged a partial exit of the Massy-based Converteam, a power conversion engineering company. In what is set to be the largest buyout of the year with a value of around EUR2bn.

Barclays initially purchased the company on the verge of bankruptcy from Alstom three years ago for around EUR150m suggesting an unprecedented plus value of around EUR1.8bn. LBO France has taken a third of the company alongside the management who also took a third by reinvesting the EUR500m plus-value. Barclays PE reinvested EUR300m in order to retain a third of the equity.

Financing for the deal was already set up for the winning bidder in a staple financing agreement of around EUR850m between HSBC, Lehman Brothers, Natixis, Societe Generale and Royal Bank of Scotland.

The other company Cegelec, a technological solutions and services integrator, is to be divested by LBO France and the management who have entered exclusive negotiations with Qatari Diar, a part of Qatar's investment authority. The auction price is around the EUR1.7bn mark. LBO France initially acquired Nanterre-based Cegelec in Q1 2006 for EUR1.1bn. The firm operates in 30 countries and generated EUR3bn in turnover in 2007.

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Send to  

• Topics
• Industry
• France