UK mid-market buyout firm HgCapital has set itself a three-week deadline to decide whether to launch a rival bid for Boosey & Hawkes, the UK classical music publisher currently the subject of a £40m offer from UK-based private equity firms European Acquisition Capital and Stirling Square.
In a statement to the London Stock Exchange yesterday evening, HgCapital said it was “seriously considering” making a cash offer for Boosey & Hawkes at a premium to the 195 pence per share recommended offer announced on Tuesday. HgCapital said it would clarify its position within three weeks as to whether it intends to make an offer.
News of a potential rival bid further complicates the bidding for Boosey, which has been the subject of bid speculation over the past two years. In late 2001, the group received a £50m offer from Graphite Capital and UK-based trade buyer Music Sales. Boosey rejected the offer but confirmed that it had instructed Deutsche Bank to look into a possible sale of its instrument division.
In February 2003, the group sold the musical instrument unit to Rutland Fund Management, the private equity fund of Rutland Trust in a deal worth £33.2m.
Nick Martin, media director at HgCapital, declined to give further details of HgCapital’s possible intervention. He said the firm had put arrangements in place for financing the transaction, but declined to reveal the identity of the backers.
“We have a dedicated media investments team at HgCapital and have already executed several deals in the media rights sector,” said Martin, who is a director on the board of Eagle Rock Entertainment, the German media rights group. “We intend to update shareholders on the progress of a possible offer within the next two weeks.”
In the year ended 31 December 2002, Boosey & Hawkes reported sales from continuing operations of £26m (2001: £24.7m like-for-like) with an operating profit from continuing operations, excluding exceptional items, of £1.2m (2001: operating profit £1.5m).