Carlyle, Seven Scrap Sale of Australia’s Coates Hire
Seven, controlled by billionaire Kerry Stokes, and Carlyle “remain fully committed to the business,” Sydney-based Seven said in a statement today. The companies each own 45 percent of Coates.
Coates, which was acquired for A$1.7 billion ($1.6 billion) in 2008, hired Goldman Sachs Group Inc. in November to advise on the sale. The owners were seeking more than A$3 billion, a person familiar with the matter said at the time. UMW Holdings Bhd., Malaysia’s biggest carmaker and assembler, was among companies studying a bid, separate people with knowledge of the matter said last month.
Mergers and acquisitions involving Australian companies fell to their lowest level in nine years in the first quarter as the nation’s mining boom slows amid declining commodity prices. The value of deals fell to $9.7 billion in the three months to March from a year earlier, according to data compiled by Bloomberg.
The Bureau of Resources and Energy Economics projected in a May 22 report that investment has peaked after A$150 billion of mines were delayed or scrapped in the past 12 months. This year, Australian mining support companies Boart Longyear Ltd. (BLY), Transfield Services Ltd. and UGL Ltd. said the deferral of major projects would impact earnings.
Coates has more than 200 branches around the country, according to the company’s website. Nomura Holdings Inc. (8604) and China International Capital Corp. were appointed to assist Goldman in canvassing buyers in Japan and China, Seven said in a November statement.
Seven and Washington-based Carlyle had also studied an initial public offering of Coates, two people with knowledge of the matter said in July.
Inquiries from potential buyers prompted the owners to examine “ownership alternatives,” Coates Chairman Peter Gammell said in November.
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