Candover Partners, the London-headquartered private equity firm, has unveiled a €1.2 billion exit of Ontex, a Belgian manufacturer of diapers and sanitary products. TPG and GS Capital Partners are acquiring the business.
TPG and GS Capital Partners could not immediately be reached for comment while Candover declined to comment.
The deal will see the end of a challenging investment for Candover. It originally acquired the business in January 2003 for €625 million. At one stage the carrying value of the business was marked down to as little as 25 percent of the original investment. In 2007 Candover invested €54.8 million in the business following a breach of banking covenants.
An exit at €1.2 billion would allow Candover to recoup 70 percent of its overall investment in the business.
Candover Investments, the listed vehicle that owns Candover Partners and is a significant LP in its funds, is currently in talks with the Alberta Investment Management Corporation (AIMCo), a Canadian pension fund which is interested in acquiring the listed company.
According to a report in Thursday’s Financial Times, the talks are stalling due to resistance from a group of UK-based bondholders. Candover declined to comment on progress of the talks. There has been no announcement on the stock exchange’s Regulatory News Service regarding the status of the talks.
An analyst at Oriel Securities wrote in a client note: “We are not surprised that the negotiations on a bid for Candover appear close to an end. The share price has been implying for the last few weeks that the market thought this bid was unlikely to materialise.”
Candover Investments' share price had dropped nearly 9 percent at press time to 665 pence per share, down from its 700 pence per share opening price.