BC Partners, Blackstone and CVC are reportedly among the private equity players lining up to bid next week for BSN Medical.
Citing “several people close to the matter,” Reuters reported that BSN Medical’s rivals, such as Sweden’s SCA and U.S. and Chinese companies, are also expected to submit offers for an acquisition potentially worth about €3 billion ($3.4 billion).
Swedish buyout firm EQT, which put BSN up for sale earlier this year, will compare the bids to the potential return from a public stock market listing, with the help of JP Morgan and Morgan Stanley, the sources said.
EQT and the potential bidders declined to comment.
“It’s a dual track and the initial public offering is the preferred option. The publication of an intention to float is expected in the first half of 2017,” 1 of the people said.
BSN reported earnings before interest, taxes, depreciation and amortization (EBITDA) of €201 million in 2015, which is expected to increase to €216 million this year and €235 million next year, another source said.
EQT is hoping for a valuation of at least 13 times BSN’s expected 2017 core earnings, the people said.
Rivals such as Smith & Nephew (NYSE:SNN), C.R. Bard (NYSE:BCR) and Coloplast (CPH:COLO B) trade at multiples of 10.3-16.1 their expected core earnings. Medical products maker ConvaTec is planning an IPO at a valuation of more than 13 times expected core earnings.
BSN, which employs about 6,000 people worldwide, was set up in 2001 as a joint venture between Germany’s Beiersdorf and Britain’s Smith & Nephew when the 2 decided to combine their wound care, fracture management, physiotherapy and compression therapy businesses.
EQT bought BSN medical, whose brands include Leukoplast plasters, in 2012 in a €1.8 billion deal.
EQT has expanded the business through acquisitions as part of a buy-and-build strategy to boost BSN’s operations in markets including France, Brazil, South Africa and New Zealand.
Bankers are preparing about €1.4 billion of debt financing to back a potential buyout of BSN, banking sources said earlier this week.
($1 = €0.8928)