TowerBrook Capital Partners LP, the former private-equity arm of Soros Fund Management LLC, is considering refinancing European companies it owns, according to two people with knowledge of the matter.
TowerBrook held preliminary discussions about replacing existing borrowing for U.K.-based ventilation company Volution Group Ltd. with new loans and possibly paying itself a dividend, said the people, who asked not to be identified because the talks are private. Volution was bought by London-based TowerBrook last year in a deal valued at 163 million pounds ($259 million), the people said.
The private-equity firm is planning to seek new financing for London-based retailer Phase Eight Fashion & Designs Ltd., one of the people said. It will also look at securing new terms on other companies it owns, including French-based automotive-equipment maker Autodistribution SA, the person said.
Private-equity companies are refinancing and extracting cash from the businesses they own as borrowing costs are at record lows and and deal activity remains subdued. Debt financing for dividend payouts rose to 7.3 billion euros ($9.9 billion) this year, almost triple the amount for the same period in 2012, according to Fitch Ratings.
TowerBrook, which was spun out of George Soros’s fund-management business in 2005, will probably not buy any more companies this year, one of the people said. It bought British aircraft-interiors maker AIM Aviation Ltd. for 160 million pounds last month.
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