As expected, HgCapital has submitted an improved offer for listed UK music publisher Boosey & Hawkes following the £40.1m offer made by Stirling Square and European Acquisition Capital last month.
HgCapital said in September that it was preparing a bid for Boosey at a premium to the 195 pence per share on the table from Stirling and EAC, and this morning the firm proposed a 215 pence bid which was accepted by the company’s board of independent directors.
Hg’s offer, which values the business at £44.3m (E63.3m), is at a ten per cent premium to the 195 pence proposed by Stirling and EAC.
HgCapital said in a statement that the publishing division was “an attractive business which will benefit from private ownership, enabling it to focus on its core business activities and providing it with access to capital for both organic and acquisition based growth.” HgCapital has put together a finance package worth £84m which includes £46m of senior debt facilities provided by Barclays bank. HgCapital would invest £38m of equity.
Boosey & Hawkes is one of the largest specialist classical music publishing companies in the world and owns a catalogue of music copyrights including composers such as Stravinsky, Rachmaninoff, Britten, Copland, Richard Strauss, Bartók and Prokofiev.
Boosey & Hawkes has been a popular target for private equity firms during the past two years. In addition to the current offers from Hg and Stirling, Close Brothers Private Equity and 3i have all expressed an interest in the business and in late 2001, the company received a £50m public-to-private offer from Graphite Capital and UK-based company Music Sales. Boosey rejected the offer but confirmed that it had instructed Deutsche Bank to look into a possible sale of its instrument division. In February 2003, the group sold that business to Rutland Fund Management in a deal worth £33.2m.
In the year ended 31 December 2002, Boosey & Hawkes reported sales from continuing operations of £26m (2001: £24.7m like-for-like) with an operating profit from continuing operations, excluding exceptional items, of £1.2m (2001: operating profit £1.5m).