LBO France to exit Actaris in secondary deal

The French private equity group is set to make a quick return on the utilities metering business it acquired in 2001, selling the business to HSBC Private Equity.

HSBC Private Equity, the private equity arm of the UK bank, is planning to acquire Actaris, the French provider of energy metering systems, in a deal that is likely to value the business at over E600m.

 

HSBC PE is buying the company from LBO France, the French private equity firm set up by Gilles Cahen-Salvador in 1985. LBO France acquired the business, which consisted of the non-US operations of Schlumberger Resource Management Services in November 2001, for a price of around E400m.

 

The deal will provide LBO France with a healthy return on the investment it made in Actaris less than a year and a half ago. Schlumberger had originally planned for the business to be sold to Ruhrgas, only for the deal to be rejected by the EU competition authorities, allowing LBO France to step in with a reduced offer for the business.

 

According to Reuters, HSBC Private Equity has arranged senior debt worth E400m for the secondary buyout. LBO France’s original deal was backed by ING and Royal Bank of Scotland, which arranged E245m of senior debt and E28m of mezzanine financing.

 

Actaris employs more than 7,000 people across 60 locations, with manufacturing, sales, services and support centres worldwide. The company reported turnover of E750m in 2000 and is one of the world’s biggest providers of metering systems for gas, electric and water.

 

The deal is set to be the first undertaken by HSBC Private Equity following its management buyout from the global bank. The business is being acquired by management, led by Chris Masterson, and will be re-named Montagu Private Equity. HSBC will retain a 20 per cent stake in Montagu.