London deal ends busy year for CD&R

New York-based buyout firm Clayton, Dubilier & Rice today announced a major acquisition in Europe – the buyout of BCA, a London-based vehicle auctions and remarketing company.

Clayton Dubilier is buying BCA from Montagu Private Equity. A source close to the transaction said it had an enterprise value of roughly £390 million ($620 million; €432 million). Montagu purchased the company in 2006 for roughly £450 million, according to the London firm.

The management of BCA, headed by chief executive Jon Olsen, will retain an equity stake in the company.
Fred Kindle, a London-based Clayton Dubilier partner, will become chairman of BCA.

In a statement, New York-based Clayton Dubilier partner David Wasserman said: “Our work with [Clayton Dubilier portfolio company] Hertz and other similar services makes us very comfortable with the business model and value proposition of BCA.”

Equity for the BCA deal came from Clayton Dubilier’s new fund, which will conclude fundraising at the end of this year. A source said the final sum would be “close to $5 billion”. With the BCA investment, more than $1 billion in equity has been put to work from the fund – the firm’s eighth. During 2009 Clayton Dubilier also invested in JohnsonDiversity, a provider of cleaning products, and NCI Building Systems, a maker of metal products for the building industry.

The source described debt financing for the BCA deal as being “oversubscribed”. Bank of America, Merrill Lynch, BNP Paribas Fortis, Commerzbank, HSBC, Investec, Lloyds TSB, The Bank of Ireland and The Royal Bank of Scotland participated in the financing, according to a statement.

Clayton Dubilier’s previous fund raised $4 billion. The firm was founded in 1978 and is best known for its strategy of deploying operating partners for its portfolio companies.