Global private equity giant KKR & Co has teamed up with Australia’s biggest PE firm, Pacific Equity Partners, to make a joint bid for $1 billion services company SAI Global.
It is understood the pair are working together on an indicative offer for the standards, assurance and information business, and are likely to lodge a first-round bid in time for the July 15 deadline.
Sources said KKR and PEP would split the equity investment 50:50, in what would be their first joint play.
PEP, which kicked off SAI Global’s auction with a non-binding $1.1 billion offer in May, is believed to be keen to leverage KKR’s strong relationships in the United States, particularly for SAI’s compliance unit.
KKR is said to be eager to utilise PEP’s local experience and network to help grow the domestic-focused information services unit. One of KKR’s key dealmakers, Edward Bostock, also spent three years at PEP before joining KKR in 2007 so he knows the team well.
This latest development comes as KKR circles Treasury Wine Estates after lobbing a $4.70-a-share bid in May. The approach was rebuffed by the beleaguered wine giant which said the offer did not properly value the company an d that it would continue to pursue the strategic plan of its new chief executive Michael Clarke.
Certainly, PEP has had more success in Australia with public-to-private deals. It managed to raise $995 million in its float of cleaning and catering company Spotless Group in May after taking the company private for $723 million in August 2012 following a hard-fought battle with shareholders.
SAI Global’s adviser, Macquarie Capital, has told bidders to submit offers for the parts of SAI they are after, and the bank will pair them up with other bid partners if need be.
UK-based teaching software provider SkillSoft, owned by private equity firm Charterhouse Capital, has its eye on the compliance division. It is also believed Bureau Veritas, Intertek and Det Norske Veritas are weighing offers for parts or all of the company.
KKR, PEP declined to comment.
SAI Price at posting:
$5.10 Sentiment: Hold Disclosure: Held
