Reuters – Springer Science Owners to Approach Buyers

Private equity firms EQT and GIC will start contacting potential buyers for Springer Science+Business Media next week, aiming to fetch up to 4 billion euros ($5.2 billion), two people close to the process told Reuters. The owners have been preparing an initial public offering (IPO) of the German speciality publisher for April 2013 but are now launching a parallel sales process as an outright sale will generate greater proceeds, the sources said.

(Reuters) – Private equity firms EQT and GIC will start contacting potential buyers for Springer Science+Business Media next week, aiming to fetch up to 4 billion euros ($5.2 billion), two people close to the process told Reuters.

The owners have been preparing an initial public offering (IPO) of the German speciality publisher for April 2013 but are now launching a parallel sales process as an outright sale will generate greater proceeds, the sources said.

Potential bidders will get information packages from next week, they said.

Springer Science, the world’s second-largest publisher in science, technology and medicine after Reed Elsevier, and EQT declined to comment. GIC was not immediately available for comment.

An IPO remains the preferred option, two people close to the transaction said, adding that advisory boutique Lilja has been mandated alongside Goldman Sachs and JP Morgan to help organise the flotation.

In a similar divestment process last year, EQT prepared an IPO of German cable group KabelBW but ended up selling the business to Liberty Global.

EQT and GIC hope to get the attention of German media group Bertelsmann, British business media group Informa , Dutch publisher Wolters Kluwer and Anglo-Dutch peer Reed Elsevier, a person close to the owners of Springer Science said.

Big private equity groups such as KKR, Carlyle , Providence, Blackstone, CVC and BC Partners will also get the information memorandums, the sources said.

Several people said Springer Science could carry a price tag of 3-4 billion euros, meaning it would fetch between 8.6 and 11.4 times expected 2012 EBITDA. By comparison, peer Wolters Kluwer trades at a ratio of enterprise value to EBITDA of 7.4 and Pearson at 10.5, according to StarMine data.

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