PE Firms Team Up for Beckman Coulter Bids

Private equity firms Blackstone and Kohlberg Kravis Roberts & Co. are teaming up in a bid for medical test maker Beckman Coulter, Reuters reported. Two other firms, Apollo and the Carlyle Group, may also join forces as the auction for Beckman enters a second round, Reuters said. Beckman, which has a market capitalization of roughly $5 billion, hired Goldman Sachs Group Inc. to help it weigh options, including a possible sale, Reuters reported last year.

(Reuters) – Private equity firms are pairing up in the bidding for Beckman Coulter (BEC.N) as an auction for the medical test maker moves into the second round, several sources familiar with the matter said.

Blackstone (BX.N) and Kohlberg Kravis Roberts & Co (KKR.N) are joining up, four of those sources said; while Apollo [APOLO.UL] and Carlyle [CYL.UL] also remain in the auction and are likely to team up, one of those four sources and a separate, fifth, source said.

Bain (BAIN.PA), which had originally looked to pair with Carlyle, put in a bid in the first round, but its interest has since waned, two of the four sources first mentioned said.

It was unclear whether TPG — which has been interested, sources previously told Reuters — is part of a consortium.

Beckman, which has a market capitalization of roughly $5 billion, hired Goldman Sachs Group Inc (GS.N) to help it weigh strategic options, including a possible sale of the company, sources previously told Reuters last year.

Initial offers were due before Christmas and a number of private equity firms submitted bids. Interested private equity firms were being encouraged by the seller to form consortiums in the second round of bidding, sources said.

Beckman’s size means it is unlikely one private equity firm alone can bid for the firm.

The auction has also drawn interest from some strategic firms — companies in the same sector as Beckman in contrast to buyout groups — which may push up the price for private equity buyers.

Strategic bidders can typically pay more for companies than private equity buyers as they can generate greater cost savings and efficiencies from merging similar companies.

Some strategic bidders have dropped out of the race but at least two remain, of which one is Danaher Corp (DHR.N), another source — a sixth source — familiar with the situation said.

The sources spoke to Reuters on Monday and Tuesday and all spoke on condition of anonymity because the auction is not public.

Beckman Coulter and all the private equity firms declined comment. Danaher was not immediately available for comment on Tuesday. (Reporting by Megan Davies and Soyoung Kim in New York; Additional reporting by Jessica Hall in Philadelphia and Bill Berkrot in New York; Editing by Phil Berlowitz)