The three main players in the continuing race to acquire struggling UK telecommunications firm Energis are reported to be on the brink of forming an alliance which will see the firms combine to acquire the firm.
According to several weekend reports, UK private equity firms Apax Partners and Permira are teaming up with US firm Carlyle Group to take Energis private.
The three firms had previously been involved in two separate bids. Apax and Carlyle had been working alongside Duncan Lewis, former head of Mercury Communications and Equant. Archie Norman, the former Asda chief executive, has been involved in the Permira bid.
The new offer will see the three private equity firms taking on £690m of bank debt drawn by Energis, but providing only a small amount of new capital. The Observer suggests that the offer for the issued share capital of Energis could be as low as £90m. According to one analyst, this price is likely to be deemed unacceptable by Energis bondholders, who had originally been hoping to secure a £1bn price.
The firms are likely to submit a bid to Goldman Sachs, which is overseeing the auction on behalf of Energis, later this week.