RLPC-Allianz Capital attracts bids for Selecta – say bankers

By Claire Ruckin

LONDON, July 3 | Tue Jul 3, 2012 4:38pm IST

(Reuters) – Allianz Capital Partners has attracted a number of potential buyers in the sale of its European vending machine business Selecta, which is expected to fetch at least 700 million euros ($881 million), banking sources said on Tuesday.

HSBC is running the sale process and a handful of private equity firms have made it through to the second round of the auction phrase with bids due on July 25, the sources said.

Advent, Apax Partners and BC Partners are expected to submit bids, while Oaktree has also been close to the process, the sources said.

Advent and BC Partners declined to comment, while Apax and Oaktree were not immediately available to comment.

CVC had been regarded as a likely bidder as it owns rival vending machine operator Autobar Group, but it is thought not to be involved in the process, bankers said.

Some bidders had been put off Selecta, which has an EBITDA of around 130 million euros, as it has not managed to deleverage its debt or produce large profits, bankers said.

“The asset has not been properly invested in but there is a lot of potential to achieve growth margins and grow the business going forward with new sponsors, the right debt structure and a focus on the right geographies,” a banker said.

Allianz bought Selecta from Compass Group in 2007 for 772.5 million pounds ($1.21 billion) backed by 690 million pounds of debt, according to Thomson Reuters LPC data.

HSBC has put together a staple financing package of around 600 million to 700 million euros to back the buyout and will be offered to any private equity bidder, bankers said. Other bankers are working with specific sponsors on debt packages to back a buyout which involve a mixture of senior leveraged loans and sub debt.

Founded in 1957, Selecta has more than 150,000 vending machines in 22 countries and generates 700 million euros in revenues, according to the company’s website.

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