CHARTERHOUSE Capital Partners has agreed to buy German insulation firm Armacell from Bahrain-based private equity firm Investcorp for over €500m (£423m), it said yesterday.
Charterhouse’s acquisition will be backed with debt financing provided by BNP Paribas and Credit Suisse. The leveraged loan financing could include senior or junior debt and total around five times Armacell’s earnings before interest, tax, depreciation and amortisation of about €70m.
The sale was started earlier this year in a process managed by Barclays, attracting a number of private equity firms including Charterhouse, HgCapital and Pamplona but the sale stalled after bids received were deemed too low.
Investcorp considered alternatives to a sale including holding onto Armacell and lined up a dividend recapitalisation, a process that adds debt to a company’s existing borrowings and enables a dividend to be taken from it. However, Charterhouse returned to the table with an offer of over €500m, leading Investcorp to discard the dividend recapitalisation and push ahead with the sale.
City A.M. Reporter