3i prepares to sell car parts maker Hilite – Reuters

Reuters – Private equity group 3i (III.L) is preparing to sell German car parts maker Hilite International in a deal that could be worth more than 400 million euros (332 million pounds), two people familiar with the transaction said.

Morgan Stanley (MS.N) has been hired to look at options including a potential sale or refinancing, the sources added, as 3i seeks to take advantage of an upturn in car markets.

Large car component manufacturers such as BorgWarner (BWA.N) and Hitachi (6501.T), along with Chinese suppliers, will be approached to gauge interest, the sources said.

Hilite, which makes automatic transmission parts and cam-phasing systems that help engines to run more efficiently, numbers leading carmakers Volkswagen (VOWG_p.DE), Daimler (DAIGn.DE), BMW (BMWG.DE), General Motors (GM.N) and Chrysler among its customers.

The company was bought by 3i in 2011 at a valuation of about $300 million, sources familiar with the deal said at the time.

It has about 1,300 employees, annual sales of 340 million euros and earnings before interest, tax, depreciation and amortisation of about 60 million euros.

The price for Hilite is expected to be between 360 million euros and 420 million euros, the sources said, equivalent to a valuation of six to seven times its core earnings.

Britain’s 3i, BorgWarner and Morgan Stanley all declined to comment, while a Hitachi spokesman was not immediately available for comment.

(Reporting by Arno Schuetze; Editing by David Goodman)