Montagu delays €1.9bn BSN sale

Worries that initial bids were not deliverable in current market conditions led the former captive of HSBC to withdraw its German medical supplies company from an auction process.

Montagu Private Equity has pulled its German bandage maker BSN Medical out of an auction process because it was not confident that the initial bids received could be delivered.

Montagu initiated the auction in July after receiving some “attractive” unsolicited bids, a source close to the situation told PEO, but as markets rapidly deteriorated the firm cancelled the process.

The firm had expected to sell BSN Medical for between €1.8 billion ($2.5 billion) and €1.9 billion by the end of the first quarter 2009. “With strong sales and EBITDA ahead of expectation, [Montagu] considered itself better off remaining invested in the company and supporting further growth,” the source said.

Montagu declined to comment.

London-based Montagu beat rival private equity firms Apax Partners, Advent International and CVC Capital Partners in an auction in January 2006 to acquire BSN Medical, a German maker of casts and bandages, for €1.03 billion.

Montagu Private Equity spun out of global banking group HSBC in March 2003.