Terreal stays at home

LBO France, the Paris-based buyout firm, has agreed to acquire Terreal, a French tile manufacturer, for a total consideration of €860m. The vendors were Carlyle and Eurazeo, the listed French private equity group.

The sale remains subject to the agreement of the relevant anti-trust authorities. The announcement follows the statement given on July 13, when Carlyle and Eurazeo said they had entered into exclusive negotiations with LBO France.

LBO France, which was advised by Rothschild, beat rival bids from French buyout firm PAI Partners and Wienerberger, the Austrian building materials group.

Eurazeo and Carlyle acquired Terreal in September 2003 for €400m, including debt, from buildings group Saint-Gobain, and went on to refinance the company with €420m of debt. Prior to the latest transaction, Carlyle held a 60% stake in Terreal and Eurazeo the remaining 40%.

Terreal makes clay construction products used for roofs, structural work, wall claddings and decoration environmental protection. It is France’s second-largest manufacturer of clay tiles, with a 35% market share in 2004. Goldman Sachs advised Terreal on the transaction.

Carlyle Europe has a team of 75 investment professionals based in six offices. It has completed 22 buyout transactions in Europe, including eight in France. The investment in Terreal was made from Carlyle Europe Partners II. Other investments in the fund include Avio, the Italian aerospace company; Saprogal, the animal food distributor; HT Troplast, a manufacturer of vinyl profiles; and AZ Electronic Materials, a specialty chemicals business.

Eurazeo has a market cap of more than €4bn.