CHAMP plots latest Australian PTP

CHAMP Private Equity has become the latest of the established Sydney-based private equity managers to stage a take-private attempt. The target is Melbourne manufacturer Nylex Limited.

CHAMP Private Equity has followed the footsteps of some of its peers by launching a take-private offer for an Australia-listed entity. Unlike Pacific Equity Partners, Archer Capital and Ironbridge Capital, CHAMP had not launched any take-private offers in the country until now.

CHAMP has offered A$150 million ($133 million; €89 million) to acquire diversified manufacturer Nylex Limited in an all-cash offer of A$2.65 per ordinary share or convertible note, and 81 cents per option, according to a filing with the exchange.

The proposed offer represents a 44 percent premium over Nylex’s closing price on 23 November, prior to the announcement of the proposed takeover. The company’s share price jumped 32 percent to close at A$2.43 today.

CHAMP has entered pre-bid agreements with Nylex’s major shareholders Garden Park Equities and Harmony Investment Fund, for up to 19.9 percent of Nylex's shares. Under the proposed terms, Nylex will reimburse the financial sponsor’s cost of A$1.5 million if it fails to announce a recommended offer by 31 January. Until then, CHAMP has exclusive rights to undertake due diligence and negotiate an implementation or bidding agreement, according to the statement.

CHAMP is investing from a A$950 million fund, a 2005 vintage which was the largest buyout fund dedicated to Australia and New Zealand at the time it closed. Since then, Pacific Equity Partners, Ironbridge and Archer have raised larger funds, and the Australian private equity market has seen a flurry of public-to-private attempts initiated by financial sponsors.