Cinven looks at Iliad and Wolseley

If speculation turns to action, it could be a busy month for Cinven. Sources have indicated that the European private equity house plans to make a friendly takeover bid for internet service provider Iliad this month, valuing it at €5bn.

It is suggested that Cinven has the financial backing of Morgan Stanley and that BNP Paribas and Rothschild have been appointed to handle the deal.

Iliad, which owns ISP Free among other activities, had sales of €950.2m in 2006, a rise of 31% from the year before. At the same time there is talk that Wolseley, the building and plumbing materials supplier, is facing a £10bn takeover offer from Cinven. Wolseley, capitalised at £8.1bn, saw its share price rise by 7.67% in early trading on February 14 on news of the imminent takeover approach.

The potential bid is apparently in its early stages and no approach has yet been made to Wolseley’s chief executive, Chip Hornsby. The report added that Cinven’s plan includes finding a partner for the bid so Wolseley can be broken up. Cinven would take over the UK and European operations, while any partner would take control of Wolseley’s American business.