Saga, the UK company selling travel, leisure and financial services to the over-50s, has agreed to a management buyout funded by Charterhouse Development Capital.
According to a press release, the agreed deal values the company at £1.35 billion (€1.96 billion; $2.42 billion).
To win control of Saga, Charterhouse participated in an auction run by UBS in which several other private equity groups also bid. In the final round of the auction, Charterhouse was competing against a consortium comprising Candover, JP Morgan Partners and HgCapital, the mid-market investor which last week reportedly withdrew from the bidding before the auction ended.
Earlier in the process, Cinven and Apax Partners had also shown an interest in Saga.
The buyout is fronted by Andrew Goodsell, Saga’s chief executive. Alongside an outright sale, the company had also considered a floatation a viable option at this stage.
The deal’s main beneficiary is retiring Saga founder and chairman Roger De Haan, whose family is selling all of its 100 percent interest in Saga’s share capital as part of the deal.
Charterhouse is currently investing from Charterhouse Capital Partners VII, a €2.7 billion fund closed in July 2003.
One of the firm’s differentiating habits is to invest its funds across a relatively small number of deals, each of which tend to require a larger portion of a fund’s equity capital than the firm’s competitors would typically allocate to a single investment.
In May 2004, Charterhouse agreed to buy Autobar, a UK-based catering products company for more than €800 million ($960 million).