On its website, private equity firm Olympus Partners used to boast about how it had "never executed a leveraged recapitalization of an existing portfolio company." You won't find that claim there today, however, after the firm announced a $110 million leveraged recap of Taco Bell franchisee K-Mac Enterprises Inc. The deal included a $59 million dividend for existing shareholders (i.e., Olympus), $2.7 million in bonuses to 25 K-Mac employees and a bunch of left over working capital that K-Mac can use to buy and build new restaurants. So what happened? "The company had leverage of less than 1x EBITDA before the recap, which wasn't sensible from a tax perspective" explains Rob Morris, managing partner of Olympus. "We increased leverage by doing the recap, but it's effectively less than it was after the original deal -- 2.5x versus 3.5x -- which is also a heck of a lot less leverage than your typical LBO and is a much more efficient balance sheet than no debt at all."
LONDON (Reuters) – Informa Plc, the British media group, ended talks to buy Springer Science + Business Media, saying it could not do a deal in the time frame required by the debt-laden firm’s private equity owners. The withdrawal of the Lloyd’s List publisher, days after it confirmed it was considering a takeover of Springer, […]
Fewer deals, more dollars. That's the gist of November data provided by Thomson Reuters, which shows that a decrease in global deal volume was counteracted by an increase in aggregate disclosed values. Global M&A hit $244 billion in disclosed value for 2,809 transactions, compared to $154 billion for 3,295 deals in October. November 2008 volume was $112 billion for 3,074 deals. Private equity firms announced 164 deals last month, compared to 217 in October and 221 in November 2008. Disclosed deal values, however, rose from $17.6 billion in October to $18.08 billion in November. Download the spreadsheet by clicking here.
LONDON (Reuters) – Montagu Private Equity has ended exclusive talks about selling Survitec to rival Permira, leaving Warburg Pincus frontrunner to buy the maker of life rafts and life jackets, people familiar with the matter said. The latest twist in a sale that has been in the works since at least March highlights the continuing […]
KAR Auction Services Inc., a Carmel, Ind.-based provider of vehicle auction services in North America, has set its IPO terms to 23 million shares being offered at between $15 and $17 per share. It would have an initial market cap of approximately $2.2 billion, were it to price at the high end of its range. KAR […]
Halfway through the year and we had triple digits in our sights. But an improving economy and flexible lenders may keep keep the PE-backed bankruptcy list from topping 100. In the month of November, saw just five bankrupt portfolio companies, a slight drop from October's . We've long crossed last year's total of 49, but unless things really fall apart in December, we're not going to double that number. Newcomers to the list of money-losers include Wind Point Partners, MatlinPatterson,Genstar, MSouth Equity Partners, and Sterling Group. We also added THL Partners' storied investment in Simmons, which finally found its way into the restructuring courts. That, as we all know thanks to extensive coverage by the New York Times, isn't actually a money-losing deal. But it is THL's second bankruptcy this year; the firm last month lost its investment in Nortek. Bruckmann Rosser also joins the two-timer list with its bankruptcy of Lazy Days RV. Earlier this year the firm saw its tomato company Eurofresh collapse into bankruptcy.
CyrusOne, a Houston-based enterprise data center colocation provider, has secured a new $150 million senior secured credit facility. The banking syndicate included TD Securities, RBC Capital Markets, SunTrust Robinson Humphrey and SG Americas Securities. CyrusOne is a portfolio company of ABRY Partners.
HONG KONG (Reuters) – Geely, the Chinese carmaker picked as the preferred bidder for Ford Motor’s (F.N) Volvo unit, is seeking at least $1 billion in loans from Chinese banks to finance its $1.8 billion bid, sources said on Tuesday. Home-grown Geely, which means “lucky” in Chinese, is hungry for modern and innovative technologies from […]
ACCRA (Reuters) – Ghana’s state oil company has reached a “critical stage” in talks to acquire a stake in the giant Jubilee oilfield from Kosmos Energy, a source involved in the negotiations told Reuters on Tuesday. GNPC’s interest in the prospect, part of one of the biggest oil finds in Africa poised to make Ghana […]
Olympus Partners has sponsored a $110 million recapitalization of existing portfolio company K-Mac Enterprises Inc., the nation's second-largest Taco Bell franchisee. The deal included a $59 million dividend for existing shareholders, $2.7 million in bonuses to 25 K-Mac employees and the remainder will be used as working capital.