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Carlyle buys Oriental Trading for $1b

Brentwood Associates will sell the consumer-product company to Carlyle after a hotly contested auction.

The Carlyle Group has agreed to buy Omaha, Nebraska-based Oriental Trading Company from Brentwood Associates, which purchased the company in 2000 for an undisclosed amount.

According to the Wall Street Journal, the deal has a total value of about $1 billion, including $300 million to $400 million of equity.

Oriental Trading was founded in 1932 and is now the nation’s largest direct marketer of party supplies, novelties, toys, children’s arts and crafts, school supplies, home décor and giftware. The company is also one of the largest catalog and internet retail operations in the US, with internet sales currently accounting for over half of total revenues.

Sandra Hornbach, Carlyle managing director and head of the consumer and retail team, said that Carlyle will use its extensive network in China, where 85 percent of Oriental Trading’s products are made, to help it become more efficient. “Carlyle’s global network, especially in China, will enable us to add value through enhancing vendor relationships and direct sourcing capabilities,” she said.

Carlyle’s agreement to buy Oriental Trading comes after a hotly contested auction in which a reported three other large funds submitted bids.

Los Angeles-based Brentwood Associates will keep about 25 percent of Oriental Trading. Its current fund will sell the company, but Brentwood will use a new fund it is raising to invest in the minority stake in the company.