THL partially exits Michael Foods for $1.7bn

Thomas H Lee will sell most of its stake in Michael Foods to GS Capital Partners, giving the company its third PE sponsor.

Thomas H Lee Partners has sold most of its stake in portfolio company, food distributor Michael Foods, to GS Capital Partners. The deal, which is valued at $1.7 billion, is expected to close in the next two months.

THL acquired Michael Foods in 2003 from company management and Vestar Capital Partners for $1 billion, said a THL spokesperson, adding that Vestar bought Michael Foods for $600 million in 2001.

Earlier this month, THL added to its pharmaceutical and healthcare holdings with the $1.1 billion deal for inVentiv Health, a clinical development provider. The deal was THL’s first of the year after THL lost out on CKE Restaurants last month when Apollo Management came in with a $694 million bid. THL offered $619 million in February.

GS Capital, Goldman Sachs' private equity unit, is the largest private equity firm in the world, having raised $54.5 billion over the last five years.