TMS provides procurement and materials management services to steel producers at 81 customer sites in 12 countries. The price of $17.50 per share represents a 12.4 percent premium to TMS’s Friday closing price of $15.57.
Onex has invested a total of $249 million in TMS since first acquiring the company in 2007. Onex partially realised its initial equity investment of $200 million through an initial public offering in 2011.
Including proceeds from the IPO, the sale of TMS will return a total of $504 million to Onex, representing a 2x return multiple. Onex will pocket around $10 million in carried interest, the firm said in a statement.
The transaction is expected to close during the fourth quarter of 2013. Goldman Sachs and JPMorgan are providing debt financing in connection with the deal.
TMS’s new owner, The Pritzker Organization, is a merchant bank that makes direct investments and manages the fortune of the Pritzker family. The group’s portfolio of businesses includes Hyatt Hotels, industrial and manufacturing company the Marmon Group and container leasing company Triton Container.
Onex is currently seeking to collect $4.5 billion for its latest buyout fund, Onex Partners IV. The Toronto-based firm will commit $1.2 billion to its Fund IV, the same amount it contributed to its $4.7 billion Fund III, which is nearly 90 percent invested.
Onex manages private equity, real estate and credit securities investments, managing approximately $16 billion, of which $11 billion is third-party capital.
Onex did not return a request for comment.