Listed investment firm Eurazeo may soon check out of France’s third-largest budget hotel chain, B&B Hotels, as global private equity firm The Carlyle Group mulls an extended stay.
The pair will hold exclusive talks for the next few days based on a €485 million enterprise value, Eurazeo confirmed in a brief statement. “This short-term negotiating period will end before the end of next week and may be extended if certain conditions with regard to the financing of the transaction are fulfilled.”
A deal with Carlyle would mark at least the third change in private equity firm sponsors for the company, which has steadily grown since it was founded in 1990.
B&B: Switching sponsors
The hotel chain now operates 215 hotels in France, Germany and Italy. It reported aggregated revenues of €177 million last year, up 11.3 percent from 2008 figures.
Should Carlyle sign a deal for B&B, it is unclear which one of its private equity or real estate funds would provide equity for the transaction. A spokesperson could not immediately be reached for comment.
Carlyle and Eurazeo have worked together on French deals in the past; in 2003 they funded the €400 million buyout of French tiles and bricks manufacturer Terreal from parent company Saint-Gobain. They went on to sell it for €860 million in 2005.