(Reuters) – Six suitors are through to the second round of bidding for a 500 million euro ($680 million) stake in Springer Science and Business Media [SPSBM.UL], sources familiar with the process said.
Private equity group Apax Partners and U.S. counterpart TPG [TPG.UL] are both in the frame for a stake of up to 49 percent in the German academic publisher, the sources said. Neither company would comment.
A consortium of buy-out houses Carlyle Group [CYL.UL] and Providence has also progressed to the second round, another source said. Carlyle declined to comment while Providence was not immediately available.
A Springer Science spokesman also declined to comment.
Two unnamed trade buyers and a further unnamed private equity firm complete the list of bidders, one source said.
The group’s existing private equity owners Candover (CDI.L) and Cinven [CINV.UL] are considering selling the stake as one of several options for tackling high looming debt repayments the company is unable to meet. Neither firm would comment.
The sale comes as many in the private equity industry struggle with falling revenues in the companies they own while debt financing conditions deteriorate.
Candover is mulling a sale of all of parts of its business, having said in March it had run out of cash to invest in its own 2008 private equity fund, throwing the future of the firm into doubt.
In a twist to normal auction practice, Candover and Cinven are looking to raise 500 million euros and are asking interested parties to bid on the stake in the Springer unit they want in return, one of the sources said.
Banking sources said previously that the two were looking to sell up to 49 percent for around 400 million to 500 million euros, but were divided as to whether that price was realistic.
Other options include a buy-out.
“There is always a potential alternative where Cinven could buy out Candover if the offers are not attractive enough,” one media banker said.
Springer Science is facing a payments crunch on its 3.08 billion euro leveraged loan. The sale of the stake could help the company to reduce debt and give it the financial firepower to strike a deal with its banks.
Private equity firms may want to invest in Springer in anticipation of an eventual tie-up with listed British publisher Informa (INF.L). Springer approached Informa in 2006, but talks broke down after a few weeks.
By Simon Meads and Victoria Howley
(Editing by Douwe Miedema, David Cowell, John Stonestreet)