Private equity has turned its attention back to the public markets, if current speculation is anything to go by. Over the past fortnight, global private equity firm
CVC is understood to be a frontrunner in the auction for Lombard, for which Friends Provident has already rejected a £600m bid from Swiss Life.
Hellman & Friedman is part of the Informa consortium, in which it has partnered with Providence Equity Partners and Carlyle Group. ING and Goldman Sachs are understood to have arranged about £1.8bn of debt to support the bid.
Blackstone surfaced alongside Apax Partners and Cinven as a potential suitor for Southern Cross after the care homes provider posted a profit warning, resulting in the loss of three-quarters of its market value.
Southern Cross dismissed the speculation, saying that it had not received an approach, despite receiving general enquiries from “a number of parties” and that it was only looking to sell “certain of the care home property assets currently held on the balance sheet”.
Market sources suggest that Southern Cross would be unlikely to sell while its shares were trading at such low levels. However, Blackstone’s head honcho once described the perfect private equity downturn scenario as: “buy everything again low and ride the cycle up . . . bad times for us are not bad times the way they are for regular people”.
Blackstone has not yet returned to a previous investment – and the buyout giant had enough problems floating Southern Cross in the summer of 2006 – and the practice is rare but not unprecedented in private equity. London-based Charterhouse Capital Partners bought cleaning services company PHS Group for £600m in 2005, having previously acquired the business for £215m in 1999 until it was floated in 2001 for £475m.
Also in 2005, Nordic Capital took a controlling interest in Nycomed, a Danish pharmaceutical group it had previously owned between 1999 and 2002, while Cinven purchased Frans Banhomme from Apax, to which it had sold the plastic pipes business in 2003 after three years of ownership. More recently, Mid Europa Partners took a second bite of Poland’s Aster, having sold the cable business to Lion Capital in 2004, and Investcorp renewed its interest in a former portfolio company by buying a 25% stake.