Montagu Completes Kalle Sale, Readies Survitec Sale

LONDON (Reuters) – Buyout house Montagu Private Equity is turning its attention to the disposal of Survitec after its sale of Kalle on Thursday showed returning appetite for deals in defensive sectors, sources said.

Montagu has appointed investment bank NM Rothschild to examine options for safety equipment manufacturer Survitec, a source familiar with the situation said.

Montagu, which also owns waste management firm Biffa and electronics retailer Maplin, has received approaches for Survitec from both potential private equity and trade buyers, a separate source said.

In July, Thomson Reuters LPC reported that existing and new lenders had lined up loan financing of up to 150 million pounds for the potential sale.

Montagu declined to comment.


Montagu said on Thursday it had agreed the sale of sausage casings manufacturer and sponge cloth maker Kalle to fellow buyout firm Silverfleet Capital for 212.5 million euros ($299.7 million), in one of Europe’s few multi-million euro private equity deals of the year.

“The recession proof nature of the food sector has made it possible for us to secure new debt, with the banks more willing to finance leveraged buyouts in this sector,” Guido May, partner at Silverfleet Capital said in a statement.

Silverfleet managing partner Neil MacDougall added the firm aimed to grow Kalle partly through add-on acquisitions and had already identified several acquisition targets.

The acquisition was backed by a 133 million euro financing package from a syndicate of banks led by Bank of Ireland (BKIR.I), including 113 million euros of term debt and a 20 million euro revolving credit facility, Bank of Ireland said. The sale earned Montagu two times its original investment, one of the sources said.

Montagu Capital acquired the company for an undisclosed sum from CVC Capital Partners in 2004, the same year it bought Survitec from Alchemy for 146 million pounds ($240.4 million).

Silverfleet’s acquisition is subject to approval from the competition authorities, the firm said.

(Reporting by Simon Meads, Tom Freke and Alasdair Reilly; editing by Gilbert Kreijger) ($1=.7091 Euro) ($1=.6073 Pound)