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PE Firms Reach Second Round for SLV Group

Four buyout shops remain in the running for SLV Group, a German lighting business owned by HgCapital, Reuters said. A sale of the company could fetch more than 400 million euros ($562 million), Reuters estimated. European investment firms BC Partners, Charterhouse and Cinven are all in the second round of the auction. U.S. firm Lindsay Goldberg also remains in the running.

(Reuters) – Four private equity firms remain in the hunt for SLV Group, the German lighting business owned by HgCapital which could fetch more 400 million euros ($562 million), people familiar with the matter said.

European buyout houses BC Partners [BCPRT.UL], Charterhouse [CHCAP.UL] and Cinven [CINV.UL] are all in the second round of the auction being run by Macquarie (MQG.AX), two people said.

U.S. firm Lindsay Goldberg, established a decade ago by former Morgan Stanley (MS.N) private equity executives Alan Goldberg and Robert Lindsay, also remains in the process, those people said.

SLV, which makes residential and commercial lighting for the specialist trade, could fetch 400 million euros, people familiar with the process previously told Reuters.

HgCapital bought SLV from founder and majority shareholder Franko Neumetzler in a deal that valued the business at 320 million euros including debt.

SLV, based in Ubach-Palenberg near Aachen, posted sales of roughly 130 million euros in 2010, a source previously said.

Bankers said debt financing of around five times earnings before interest, tax, depreciation and amortisation (EBITDA) was available for the deal.

Sources previously said EBITDA was about 40 million euros, meaning that about 200 million euros of debt is available for any acquisition.

HgCapital declined to comment. The private equity bidders either declined to comment, or were unavailable to comment.

(By Simon Meads and Isabell Witt, Additional reporting by Arno Schuetze and Philipp Halstrick in Frankfurt and Megan Davies in New York; Editing by David Holmes) ($1=.7109 Euro)