The Bayer Group, a chemical and pharmaceutical holding company, will sell metal products business H.C. Starck to a consortium formed by financial investors Advent International and The Carlyle Group for approximately €1.2 billion.
The transaction value includes a cash component of more than € 700 million and the assumption of financial liabilities and personnel-related commitments totaling some € 450 million. The sale reduces Bayer’s net debt by about €1 billion, with an accounting gain of about €150 million.
The deal will complete at the beginning of 2007, subject to regulatory approval.
Milbank gave legal advice to Advent International and The Carlyle Group while Rothschild provided financial advice.
Advent and Carlyle aim to position the company for an initial public offering in three to five years.
With its headquarters in Goslar in northern Germany, H.C. Starck manufactures metal and ceramic powders, specialty chemicals, and parts made from ceramics and refractory metals. Last year the company posted sales of €920 million. H.C. Starck has 15 sites in Europe, Asia and North America.
The Bayer Group announced in March 2006 that it would sell its subsidiaries H.C. Starck and Wolff Walsrode and use the proceeds to partly finance the Schering acquisition. The two companies have so far been part of the Bayer MaterialScience subgroup, which will focus in future on its core businesses.