The sale of Springer Science & Business Media, the German academic publisher, was postponed by Sweden’s EQT Partners AB after potential buyers balked at the asking price, according to people familiar with the talks.
EQT, the private-equity firm that bought the company jointly with the Government of Singapore Investment Corp. in 2009, had been seeking offers of 3 billion euros ($4 billion) to 4 billion euros, said the people, who asked not to be identified because talks are private. The auction, scheduled to start this month, and initial public offering preparations have been put on hold as EQT reviews its options for the business, they said.
EQT, which bought Springer Science in 2009 in a deal valuing the publisher at 2.3 billion euros, hired JPMorgan Chase & Co. and Goldman Sachs Group Inc. in October to prepare a divestment, people familiar said at the time. The business had attracted interest from companies such as Bertelsmann SE and buyout firms including KKR & Co., Carlyle Group and Providence Equity Partners, people familiar said in November. The unit publishes 2,000 magazines and 7,000 books every year on subjects including science and medicine.
Springer Science has yet to report full-year earnings, which may help make the company more attractive, the people said. While the official sale process is temporarily delayed, EQT may continue holding informal talks with buyers as it seeks an exclusive negotiating partner, one of the people said.
Spokesmen at EQT and Bertelsmann declined to comment.
Bertelsmann, Europe’s largest media company, is considering teaming up with a private-equity fund like KKR or a sovereign wealth fund, people said in November. While the German company is interested, it is hesitant to make such a large acquisition and is concerned about the effect of digitalization in publishing on Springer Science’s business, one person said.
Buyout firms typically seek to improve performance at the companies they acquire before selling them within about five years. They often pay themselves a dividend from their companies when they decide against a sale.