Bain Capital LLC will not be competing for the affections of Kinetic Concepts Inc. (NYSE:KCI) after all, as the private equity titan pulled out of the running to snatch the San Antonio, TX.-based wound maker away from its betrothed, according to Bloomberg News Service.
On Tuesday, Bloomberg named the Boston, Mass.-based PE firm, along with Avista Capital Partners LLC, as trying to raise money in order to best Apax Partners LLP’s $6.3 billion bid to buy KCI. The rumors were enough to send shares of the company’s stock up 3 percent in heavy trading yesterday.
However, Bain apparently will not be going any farther down the path, according to the news service.
Citing unnamed sources with “knowledge of the matter,” Bloomberg said the firm had pulled out because of issues obtaining proper financing for the deal and disagreements over the price of the buyout. Avista is apparently still in the hunt and may be seeking other partners to make a move.
KCI agreed to a leveraged buyout by Apax and two Canadian pension funds in early July. However, one of the deal’s provisions, a so-called “go-shop” period, allowed KCI to try and raise the ante for the deal by soliciting other bids. The go-shop window closes at 11:59 p.m. August 21, according to the filing with the SEC.
The deal came after an intense 18-week courtship with Apax that saw the final price change five times before the company agreed to the LBO. Despite several published reports that other private equity firms were involved in the KCI buyout, regulatory filings revealed that there was never a serious second bidder.
Shares of KCI have since returned to normal, retreating 2 percent in midday trading from yesterday’s closing price of $67.84.