Permira Advisers LLP, the private-equity owner of companies from Hugo Boss to Birds Eye food brands, agreed to buy equipment maker Intelligrated for about $500 million.
Based in Mason, Ohio, near Cincinnati, Intelligrated makes machines that move and store products in factories and warehouses. The deal is expected to close in the third quarter of this year, London-based Permira said today in a statement.
Buyout firms are trying to complete deals amid an uncertain U.S. economy and the European financial crisis. Announced private-equity transactions dropped 42 percent to $56.3 billion during the first quarter of this year, according to data compiled by Bloomberg.
The acquisition of Intelligrated would be Permira’s fourth purchase in the U.S. since the beginning of 2011. The firm bought the Genesys call-center software unit of Alcatel-Lucent SA for $1.5 billion earlier this year. Permira also acquired Renaissance Learning Inc. and equipment-rental company BakerCorp in 2011.
“We look forward to backing Intelligrated’s highly successful management team as the company enters the next stage of its growth plans,” John Coyle, a partner at Permira who heads the firm’s North America operations, said in the statement.
Intelligrated is owned by San Francisco-based Gryphon Investors, which bought the company in 2001, according to its website. Gryphon said it specializes in companies with $25 million to $250 million in revenue.
Intelligrated’s customers have included retailer Zappos.com Inc. and Hershey Co., as well as Wal-Mart Stores Inc. and Target Corp. Permira aims to expand Intelligrated’s operations overseas, people with knowledge of the transaction said before the deal was announced.
Morgan Stanley was the lead financial adviser to Permira and RBC Capital Markets was co-adviser. Skadden, Arps, Slate, Meagher & Flom LLP was Permira’s legal adviser.
Private-equity firms pool money from pensions, endowments and government funds and pair that cash with debt to buy companies. Their ultimate success rests on their ability to sell those companies and distribute profits to those so-called limited partners.
Permira in March agreed to sell software maker NDS Group, which Permira owns with News Corp., to Cisco Systems Inc. in a deal worth $5 billion. During the past year, Permira also has sold interests in Galaxy Entertainment and animal-feed additives company Provimi to Cargill Inc.
Permira told investors last month that its fourth private-equity fund is valued at 1.26 times its cost, up from 1.1 times in December. The sale price for NDS is expected to generate a return of 2.25 times Permira’s original investment when the deal closes, according to people with knowledge of the details.