Buyout firm CVC will employ more than $1.2 billion in debt in its buyout of Ahlsell, Sweden’s largest supplier of tools and building materials, Reuters reported Thursday. According to Reuters, it is the largest loan to back a leveraged buyout in Western Europ since WorldPay’s acquisition by Advent International and Bain Capital in 2010.
(Reuters) – More than $1.2 billion of loans will be used to back private equity firm CVC’s buyout of Sweden’s largest supplier of tools and building materials Ahlsell, bankers said on Thursday.
It is the largest loan to back a leveraged buyout in Western Europe since global payments services business WorldPay’s acquisition by Advent International and Bain Capital in 2010, and the largest buyout loan in EMEA (Europe, Middle East and Africa) since Polish telecoms firm Polkomtel in August 2011.
CVC entered exclusive talks for Ahlsell in January following an auction process and sellers Cinven and Goldman Sachs Capital Partners had been seeking some 16 billion Swedish crowns ($2.4 billion) for the business.
CVC is now in discussions with banks including Goldman Sachs, Nordea and Deutsche Bank over a debt package which will come in at more than $1.2 billion, denominated in euros and Swedish crowns, or just over 4 times the company’s EBITDA (earnings before, interest, tax, depreciation and amortisation).
The loan is higher than the 8 billion Swedish crowns staple financing package originally offered to all bidders by Goldman Sachs and Nordea which was based on earnings for the twelve months to October, after the company’s full year results improved EBITDA levels.
The buyout loan is one of a handful that have emerged since the beginning of the year including the 850 million Swiss franc ($931 million) loan backing the acquisition of Orange Switzerland by Apax Partners; the 555 million pound ($880 million) equivalent loan backing CPA Global’s buyout by Cinven; and the loan being put together for the potential sale of UK frozen food supermarket Iceland Foods.
($1 = 6.7213 Swedish crowns)
($1 = 0.9130 Swiss francs)
($1 = 0.6306 British pounds) (Reporting by Claire Ruckin, Editing by Mark Potter)