UPDATE:TPG,Goldman Sachs Buy Candover's Ontex In EUR1.2B Deal

LONDON (Dow Jones)–Candover Thursday said it had sold nappy-maker Ontex to TPG and Goldman Sachs Group Inc. (GS) in a deal worth around EUR1.2 billion.

The transaction is being financed with a debt package of around EUR670 million in line with the 50/50 cash and debt mix being used to finance leveraged buyouts after the financial crisis put paid to debt-heavy deals.

Based in Belgium, Ontex makes wet-wipes and feminine products as well as nappies and primarily for retailers’ own brands. It reported earnings before interest, taxes, depreciation and amortization, or Ebitda, for 2009 of EUR150.3 million, compared with EUR94.8 million the previous year.

Ontex manufactures its products across 12 production facilities, nine of which are located in Western Europe and the remainder in Turkey, Algeria and China. It plans to open new manufacturing facilities in Moscow and Sydney later this year.

“The partnership between TPG, GS Capital Partners and the Ontex management team will open a range of new opportunities for Ontex. Through our global reach and operational capabilities, we look forward to helping drive the next stage of the company’s profitable growth,” said Simon Henderson, head of TPG’s U.K. buyout team.

The sale is part of a disposal program by buyout firm Candover, which stopped investing at the beginning of the year after its largest investor, Candover Investments PLC (CDI.LN), failed to meet a EUR1 billion commitment to the firm’s EUR3 billion 2008 fund.

Ontex was bought by Candover out of its earlier, 2001, fund which has now realized 12 of its 16 investments.

Candover Investments said that its share of the proceeds from the sale of Ontex, around EUR12.1 million and further profit from the Candover 2001 fund “will help improve the company’s liquidity at a time of high volatility in markets and weakness of the euro, the reporting currency of the Candover Funds.”

Meanwhile, Candover’s future remains unclear and recent talks about a possible takeover by Canadian pension fund Alberta Investment Management Corporation, or Aimco, are on the brink of collapse, according to a press report earlier Thursday.

SOURCE: Marietta Cauchi, Dow Jones Newswires; +44 207 842 9241; marietta.cauchi@dowjones.com

Comments are closed.