EQT Partners AB of Sweden is near a deal to buy bandages-supplier BSN Medical from Montagu Private Equity LLP in what would be Germany’s largest buyout this year, said people familiar with the process.
EQT may pay about 1.8 billion euros ($2.3 billion) for the Hamburg-based medical equipment company, said two of the people, who declined to be identified because the process is private. The takeover, which hasn’t been finalized and could still fall apart, may be announced next week, the people said.
Private-equity managers have turned to other buyout firms to buy and sell companies as the IPO market slumps amid the euro area’s debt crisis. So-called secondary sales are the second- most common way to make an exit from investments after sales to strategic buyers, accounting for 28 percent of divestitures in the first quarter, according to Preqin Ltd., a London-based researcher.
EQT Partners, partly owned by Sweden’s Wallenberg family, beat the team of BC Partners Ltd. and CVC Capital Partners Ltd. as well as French investment firm Wendel SA in the bidding, said the people, underscoring private-equity firms’ interest in the health-care sector. Montagu, which bought BSN in 2006 for about 1 billion euros, has sought to sell the company to a buyer or in an initial public offering at least twice in the past four years.
Representatives at BSN and Montagu didn’t respond to calls made outside regular business hours. A spokesman for EQT declined to comment.
BSN, which makes general wound-care and orthopedic products, has more than 4,000 employees, according to its website. The company had revenue of 665 million euros last year, the website shows.
Permira Advisers LLP and ConvaTec Inc., the wound-treatment maker owned by Nordic Capital Svenska AB and Avista Capital Partners LLC, were also among initial bidders, people familiar with the matter said last month. BSN was a joint venture of the German personal care company Beiersdorf AG (BEI) and Smith & Nephew Plc (SN/), Europe’s biggest maker of artificial hips and knees.
IPOs have given pause to private-equity owners as financial markets declined this quarter and after Facebook Inc. (FB) fell 29 percent from its public offering price. At least 15 IPOs have been withdrawn or postponed globally since Facebook’s May 17 offering.
Montagu manages a 2.5 billion-euro buyout fund and split from HSBC (HSBA) Holdings Plc in 2003. The London-based private-equity firm chose HSBC and Goldman Sachs Group Inc. (GS) to manage the BSN sale, people familiar with the decision said in January.
EQT Partners last month agreed to sell Dako, a Danish maker of cancer-diagnostics tools, for $2.2 billion to Agilent Technologies Inc. (A), the maker of scientific-testing equipment. Last year, the Swedish private equity firm bought Atos (ATO) Medical, a voice prosthesis company.