Weather Investments, the acquisition vehicle led by Egyptian businessman Naguib Sawiris has agreed to acquire Italian telecoms operator Wind Telecommunicazioni in a two-stage deal valued at €12.1 billion.
The consortium, which also comprises Philippe Nguyen, head of Paris-based Investors in Private Equity (IPE) and US distressed investment specialist Wilbur Ross, has agreed to purchase a 62.75 percent stake in Wind for €2.98 billion ($3.76 billion) by August.
As well as acquiring Wind’s €7.4 billion debt, the consortium will then have the option to buy the remaining 37.25 stake in Wind from Italian power company owner Enel for €1.7 billion in early 2006.
Naguib Sawiris: largest European LBO ever
Wind’s debt will be refinanced in five tranches, three of which will be senior according to Weather’s legal advisors Dewey Ballantine. The group is reportedly considering a €1.7 billion high yield bond to refinance part of the debt.
Weather beat off competition from a number of private equity firms, in particular The Blackstone Group, which had reportedly tabled an €11.6 billion bid for Wind.
The deal is the largest ever European LBO, almost double the recent €7 billion acquisition of German property group Viterra by Terra Firma Capital Partners.