UK - Electra-backed Vasanta to secure new PE backing

Deborah
13 July 2009

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Electra Partners-backed Vasanta Group, one of Britain's largest provider of office supplies, has reportedly said it is close to securing new private equity backing, which could save the company from administration.

Group chief executive Richard Martin has ben quoted as saying that the unnamed private equity group has been granted a "short period of exclusivity" to complete the deal. Reports further suggest that Vasanta's board had approached buyout house Alchemy Partners for fresh funding.

The new funding is expected to help in restructuring the company's finances, as well as providing necessary capital for the business.

Sheffield-based Vasanta was hit hard by the withdrawal of its credit insurance to key suppliers. It is understood that the company was suffering near collapse last week, putting more than 1,400 jobs at risk. PriceWaterhouseCoopers were even appointed as administrator in case rescue talks failed.

In May, Electra revealed it had written off £28m of its £40m investment in the company. The private equity group reportedly offered to inject more funds into Vasanta, but was rejected by the company's lenders, led by the Royal Bank of Scotland.