Buyout Firm EQT Near Deal for Swiss Travel Firm Kuoni

  • Kuoni confirms that EQT is preferred candidate after process
  • Cinven, Permira were competing to take the company private

EQT Partners AB is close to a deal to buy Kuoni Reisen Holding AG after submitting the winning bid for the Swiss travel-services company, people familiar with the matter said.

Kuoni’s board of directors confirmed that EQT was the preferred candidate for a potential takeover of the company in an e-mailed statement Thursday. No financial decision has been made on whether the offer will be accepted or on what terms, the board said.

EQT was competing with other financial investors including Cinven and Permira Advisers to take Kuoni private, people familiar with the matter said, asking not to be named because the deliberations are private. No final decisions have been made on the deal, they said. Kuoni has a market value of about 1.33 billion francs ($1.32 billion).

Kuoni has been struggling to turn around its money-losing travel services unit, which arranges group tours and books hotels, amid heightened online competition. Last year, the century-old company announced job cuts, replaced its chief executive officer in a management shakeup and proposed eliminating voting-rights limits, a move that analysts said would make it easier to buy.

Representatives for EQT, Cinven and Permira declined to comment.

Kuoni rose 6.7 percent to 334 francs at the close in Zurich. The shares have added 14 percent in the past 12 months.

New Start

Because of high stock prices and regulatory hurdles, buyout firms acquiring and taking companies private in Europe has become a rarity. Only three sizable deals have been announced in the last six years, according to data compiled by Bloomberg.

For Kuoni, a take-private transaction could help the company focus on tapping new sources of growth, such as a business that helps governments manage visa applications. The company’s stock lost about 35 percent of its value in the last decade. In November, the company reported a 79 percent plunge in nine-month profit from continuing operations.

Founder Alfred Kuoni began the travel agency in Zurich in 1906 and offered its first tour to Egypt the next year. In 1925, he joined with partner Harry Hugentobler and began expanding into France and Italy. Kuoni now employs about 8,000 people.

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