CVC to buy Samsonite for $1.7bn(2)

European private equity firm CVC Capital Partners has agreed to buy US-based Samsonite Corporation, a designer and manufacturer of luggage. The deal is part of a drive to increase CVC’s US presence.

CVC Capital Partners has agreed to buy Samsonite Corporation, a US-listed luggage maker, for $1.7 billion (€1.3 billion), including the assumption of debt.

 

The European private equity firm will acquire all of Samsonite’s outstanding stock for $1.49 per share. The capital structure of the deal is one-third equity and two-thirds debt. Samsonite’s largest shareholders, Ares Management, Bain Capital Partners, and Teachers’ Private Capital, the private investment arm of Ontario Teachers’ Pension Plan, have all agreed to sell their stakes to the buyout firm.

 

Though the deal was led by CVC’s European arm, representatives of the firm have said it is trying to increase its US presence. CVC opened its first US office in January of this year, which is headed by Christopher Stadler, formerly with Bahrain-quoted Investcorp.

 

This would only be the firm’s fifth US deal, and its first since the acquisition of broadband provider Malibu Networks in 2000.

 

CVC said in a statement that it expects to orient the brand more towards the luxury market and Asia. Managing partner Hardy McLain and partner Luigi Lanari of CVC said in the statement that “China and India present particularly interesting opportunities for [Samonsite’s] growth”.

 

If the business grows as plans, Samsonite will be “highly suitable for an initial public offering at some later date,” the statement said. Additionally, Samsonite will make “selective acquisitions” to step-change Samsonite’s growth profile in certain key markets.

 

UBS and Lehman Brothers acted as financial advisors to CVC, while Merrill Lynch International advised Samsonite. The transaction is expected to close in the fourth quarter of 2007.

 

It is CVC’s second announced deal in as many days – yesterday CVC it bought a 75 percent stake in Taminco, the world’s largest producer of alkylamines and derivatives, from AlpInvest Partners for €800 million.

 

CVC has €20.9 billion in assets under management, and has offices around the globe.