BC Partners raises €748m in listing

The private equity firm sold nearly 15m shares in chemical company Brenntag in a heated German IPO market.

Private equity firm BC Partners has raised €748 million after selling shares in German chemical distribution group Brenntag.

The firm is keeping around 71 percent of the company, which will have a net debt of €1.3 billion following the IPO. Brenntag sold about 10.5 million new shares for €525 million to repay a mezzanine loan and fund acquisitions in Latin America and Asia. The firm also sold 4.45 million shares as part of an over-allotment option that netted €223 million.

BC Partners acquired the company for about €3 billion including debt in 2006 from Bain Capital, in what at the time was one of the largest leveraged buyouts in German history, rivaling Fortress Investment Group’s €3.5 billion takeover of real estate company Gagfah Gemeinneutzige in 2004. The Brenntag acquisition was also BC Partner’s first investment in Germany in more than three years.

Brenntag has more than 300 locations in 50 countries and supplies acids, solvents and chemicals used in water-treatment to various industries in the manufacturing sector. Its IPO is the second for a German company this month, with BC Partners managing partner Stephan Zuschke telling the Financial Times that he hoped the listing would help improve the image of private equity in the country.

Providence Equity Partners successfully floated its company Kabel Deutschland, Germany's largest cable television operator, in March, raising €760 million. The IPO was Germany's largest since 2007, Kabel said in a statement.

BC is looking for another IPO in Europe as well. Last week, Amadeus IT Holding, a flight-reservations provider controlled by BC Partners and Cinven, said it will seek to raise at least $1.23 billion by selling shares on the Madrid Stock Exchange in the first half of 2010. Proceeds would be used to be used to pay down debt, and the IPO would be the biggest in Europe so far this year.